TCFD · the eleven in practice
TCFD disclosures: eleven questions a report has to answer
TCFD disclosures are the eleven lettered items beneath the Task Force’s four recommendations, set out in Figure 4 of its Final Report.
Each one is a question a reader of the annual report should be able to answer, and each now has a successor paragraph in UK SRS S2.
This page takes them one at a time: what to answer, where it goes, and how to index it.
Terms
Recommendation, disclosure, statement
Three words get used loosely, and they are different things.
A recommendation is one of the Task Force’s four headings: governance, strategy, risk management, and metrics and targets, set out on the Task Force’s website.
A recommended disclosure is one of the eleven lettered items beneath them, cited as “Strategy c)” rather than by a number out of eleven.
A statement is what UK listing rules ask for: a listed company’s account, under UKLR 6.6.6R(8), of whether its disclosures are consistent with the eleven.
The disclosures are the substance; the statement is the index that tells a reader where the substance is and what is missing.
Why the eleven sit under four headings, and how every later framework kept the same four, is on the four pillars of sustainability reporting.
The 11 recommended disclosures
Each disclosure, and what it must let a reader answer
The second column is our reading of each disclosure’s own words, not additional requirements.
The last two columns show where the same ground sits in the Companies Act and in UK SRS S2.
| Disclosure | A reader should be able to answer | CA 2006 s.414CB(2A) | UK SRS S2 |
|---|---|---|---|
| Governance a) — board oversight | Which board or committee oversees climate, how often it hears about it, and what it has decided | (a) | ¶6(a) |
| Governance b) — management’s role | Which managers own climate risk, what is delegated to them, and how they report up | (a) | ¶6(b) |
| Strategy a) — risks and opportunities | Which climate risks and opportunities matter, and over what short, medium and long term | (d) | ¶10 |
| Strategy b) — impact | What those risks do to the business, the strategy and the financial plan | (e) | ¶¶15–21 |
| Strategy c) — resilience | Whether the strategy holds under different futures, including 2°C or lower | (f) | ¶22 |
| Risk management a) — identify and assess | How climate risks are found and sized | (b) | ¶¶24–26 |
| Risk management b) — manage | What is done about them once found | (b) | ¶¶24–26 |
| Risk management c) — integrate | Whether climate sits in the ordinary risk register or beside it | (c) | ¶¶24–26 |
| Metrics and targets a) — metrics | What is measured to track climate risk and opportunity | (h) | ¶29 |
| Metrics and targets b) — emissions | Scope 1 and 2 emissions, and Scope 3 if appropriate | None | ¶29(a) |
| Metrics and targets c) — targets | What the organisation is aiming for, and how it is doing | (g) | ¶¶33–36 |
The disclosures are short, and most of the work is in the evidence behind them.
The Task Force’s October 2021 Annex gives guidance for all sectors and supplemental guidance for financial and non-financial groups, and its Table 1 records “Governance: no changes” and “Risk Management: no changes”.
Metrics and targets has its own companion, the guidance on metrics, targets and transition plans, which is the last substantive guidance the Task Force issued.
The emissions disclosure is the one with no Companies Act counterpart, which is why emissions reach most annual reports through SECR; the eight Companies Act limbs are set against the eleven on TCFD UK requirements.
Placement and the index
Where TCFD disclosures go, and how to index them
Where the disclosures go depends on which rule asks for them.
A listed company puts its statement in the annual financial report under UKLR 6.6.6R(8), and the statement has four jobs.
It says whether the disclosures are consistent with the recommendations and the eleven.
If any are in another document, it says which, why, and where that document can be found.
If any are not made, it says which, why, what steps are planned and in what timeframe.
And it says where in the annual report each disclosure sits.
A company under the Companies Act puts its eight disclosures in the non-financial and sustainability information statement, part of the strategic report, under section 414CB(A1).
Most LLPs put the same eight in their energy and carbon report instead, under the LLP regulations.
The builder beside this text drafts the listing-rule statement: mark each disclosure and it writes the four limbs for you to edit.
Your TCFD index · the statement it produces
Draft statement · UKLR 6.6.6R(8)(a)–(c)
The Company has included in this annual financial report climate-related financial disclosures consistent with the TCFD Recommendations and Recommended Disclosures.
The disclosures can be found on pages [x–y] of this report (Governance a); Governance b); Strategy a); Strategy b); Strategy c); Risk management a); Risk management b); Risk management c); Metrics and targets a); Metrics and targets b); Metrics and targets c)).
For accounting periods beginning before 1 January 2027.
From then, listed companies report against UK SRS on a comply-or-explain basis instead (FCA PS26/19).
A drafting aid, not advice; the bracketed text is yours to complete.
Nothing you enter leaves your browser.
Materiality
TCFD materiality: three routes, three tests
“TCFD applies where material” describes half of the framework.
The Final Report puts the qualifier on the Strategy and Metrics and targets recommendations, which cover six of the eleven disclosures.
Governance and Risk management, the other five, are disclosed whatever the materiality assessment concludes.
In October 2021 the Task Force asked for emissions “independent of a materiality assessment”, in its Annex §A.1, without amending the recommendation that still carries the qualifier.
The Companies Act has a different test entirely: four of its eight limbs may be omitted where the directors reasonably believe they are not necessary for an understanding of the business, with a clear and reasoned explanation.
The first four limbs, governance and risk among them, may not be omitted at all.
Under IFRS S1, and so under UK SRS, materiality is judged across the report as a whole rather than recommendation by recommendation.
| Route | What decides whether something is left out |
|---|---|
| TCFD recommendations | “Where such information is material” on Strategy and Metrics and targets only; emissions disclosed regardless since 2021 |
| Listing rule | Nothing is forced in: a gap is allowed if the statement explains it, with steps and a timeframe |
| Companies Act | Only (e) to (h), and only if the directors reasonably believe they are not necessary for an understanding of the business |
| UK SRS S2 | Materiality applies across the standard, through UK SRS S1 |
Writing them well
The seven principles, used as a drafting checklist
The Task Force set seven principles for effective disclosure.
Read as a checklist, each one catches a familiar weakness in a first draft.
| Principle | The question to ask of a draft |
|---|---|
| Relevant | Does this tell a reader something about this organisation, or would it fit any company? |
| Specific and complete | Are the business units, geographies and time horizons named? |
| Clear, balanced and understandable | Are opportunities and risks both given, in plain words? |
| Consistent over time | Can this year be compared with last year, and are changes of method explained? |
| Comparable within a sector | Would a peer’s reader recognise the metrics? |
| Reliable, verifiable and objective | Could someone trace each figure to its data and method? |
| Timely | Is the information for the reporting period, published with the annual report? |
The seven principles are on the Task Force’s recommendations page, and they are about quality rather than structure.
For companies under the Companies Act, the government’s 2022 guidance is the nearest thing to an official drafting guide, and the FRC notes that the government intends to update it.
The FCA’s own guidance on consistency for listed companies is Technical Note 802.3.
Examples and templates
TCFD disclosure examples: where to look, and what to copy
No official TCFD template exists, and the Task Force never published one annual report as a model.
What UK rules prescribe is the content of the index, which the builder on this page drafts.
The most useful examples are the annual reports of listed companies in your own sector, because the listing rule has required a TCFD statement since 2021 for premium-listed companies and since 2022 for standard-listed ones.
Read them for structure — where each disclosure sits and how the index points to it — rather than for wording.
One trap is the text itself: the December 2016 consultation draft, hosted on the FSB’s own site, often outranks the Final Report in search, and its scenario disclosure reads differently from the Final Report.
Quotations of Strategy c) without “resilience” and “or lower” come from the December 2016 consultation draft, not the Final Report.
Check any borrowed wording against Figure 4.
From 2027
What each disclosure becomes under UK SRS S2
The FCA’s final rules replace the TCFD statement for accounting periods beginning on or after 1 January 2027.
The four headings carry over into IFRS S2 and UK SRS S2 unchanged; what changes is the depth beneath them.
Governance a) and b) become the five limbs of paragraph 6(a) and the two of 6(b): mandates, skills, how often the body is informed, how it weighs climate in strategy and major transactions, and how it oversees targets.
Strategy a) becomes paragraph 10, which adds a physical-or-transition classification for each risk and asks the entity to define its time horizons against its own planning.
Strategy b) becomes the financial-effects paragraphs, which ask for current and anticipated effects on financial position, performance and cash flows.
Strategy c) becomes paragraph 22, under which the entity “shall use” climate-related scenario analysis; UK SRS S2 accepts qualitative scenario narratives as a basis.
Metrics and targets a) and b) become the seven cross-industry categories of paragraph 29, emissions among them, with Scope 3 subject to a relief.
From 2027 the listing rules keep the annual report as the home for the disclosures, and allow cross-reference to another report where UK SRS S1 paragraphs B45 to B47 permit it.
The full comparison is on UK SRS vs TCFD, the standard itself on UK SRS S2, and who has to switch on TCFD reporting requirements.
Frequently asked
TCFD disclosures: questions people ask
What are the 11 TCFD recommended disclosures?
Governance: a) the board’s oversight and b) management’s role.
Strategy: a) risks and opportunities over the short, medium and long term, b) their impact on the business, strategy and financial planning, and c) the resilience of the strategy under different scenarios, including a 2°C or lower scenario.
Risk management: a) identifying and assessing, b) managing, and c) integration into overall risk management.
Metrics and targets: a) the metrics used, b) Scope 1, Scope 2 and, if appropriate, Scope 3 emissions, and c) the targets and performance against them.
What is a TCFD disclosure?
A statement in an organisation’s reporting that answers one of the eleven recommended disclosures in the Task Force’s June 2017 Final Report.
The recommendations are the four headings; the disclosures are the eleven lettered items beneath them.
Where do TCFD disclosures go in the annual report?
For a listed company, in the annual financial report, with a statement saying whether they are consistent with the recommendations and explaining any that sit elsewhere.
For a company under the Companies Act, in the non-financial and sustainability information statement in the strategic report.
For most LLPs, in the energy and carbon report.
Is there a TCFD reporting template?
No official template exists.
What UK rules prescribe is the content of the statement that indexes the disclosures: whether they are consistent, which are elsewhere and why, which are missing, why and when they will be made, and where each can be found.
The builder on this page drafts that statement from your answers.
Do all TCFD disclosures depend on materiality?
No. The Strategy and Metrics and targets recommendations carry the words “where such information is material”; Governance and Risk management do not.
Since October 2021 the Task Force has also asked for greenhouse gas emissions independent of a materiality assessment.
What did the October 2021 update change?
The guidance, not the disclosures.
The Task Force said it had not modified its four recommendations or the eleven recommended disclosures; it updated the guidance for all sectors, added guidance on metrics, targets and transition plans, and asked for emissions independent of materiality.
What happens to TCFD disclosures under UK SRS S2?
Each carries over into the matching part of UK SRS S2, which asks for more: a physical-or-transition classification for each risk, current and anticipated financial effects, scenario analysis the entity shall use, seven cross-industry metric categories and, for some sectors, financed emissions.
Listed companies make the switch for accounting periods beginning on or after 1 January 2027.
Can TCFD disclosures be in a separate sustainability report?
Under the listing rule they can, but the statement must say which are elsewhere, why, and where.
Under the Companies Act the disclosures belong in the strategic report.
From 2027 the listing rules keep the annual report as the home, and allow cross-reference to another report where UK SRS S1 paragraphs B45 to B47 permit it.
Sources
Primary sources
Every figure, date and status on this page traces to the instrument’s owner.
Secondary commentary is never the source for a number.
- Task Force on Climate-related Financial DisclosuresFinal Report, June 2017 — Figure 4, p. 14
The eleven recommended disclosures, verbatim.
- Task Force on Climate-related Financial DisclosuresRecommendations
The eleven and the seven principles for effective disclosure.
- Task Force on Climate-related Financial DisclosuresImplementing the Recommendations — October 2021 Annex, §A.1 and Table 1
What the 2021 update changed: guidance only, and emissions independent of materiality.
- Task Force on Climate-related Financial DisclosuresGuidance on Metrics, Targets, and Transition Plans (October 2021)
The detailed guidance behind Metrics and targets a) to c).
- Financial Conduct AuthorityFCA Handbook, UKLR 6.6.6R(8)
The four-limb statement that indexes the eleven in a listed company’s annual financial report.
- Financial Conduct AuthorityPrimary Market Technical Note 802.3
The FCA’s guidance on consistency with the recommendations.
- Financial Conduct AuthorityPS26/19 (PDF) — ¶1.10 and Appendix 1, UKLR 6.6.6R(8)(c) from 1 January 2027
The replacement and the new location rule, with cross-reference under UK SRS S1 B45–B47.
- legislation.gov.ukCompanies Act 2006, section 414CB(A1), (2A), (4A)–(4B)
The eight disclosures for companies and where they sit.
- legislation.gov.ukSI 2022/46, regulation 4 — the energy and carbon report of a large LLP
Where most LLPs put the same eight.
- Department for Energy Security and Net Zero / BEISClimate-related financial disclosures for companies and LLPs (21 February 2022)
The government’s non-binding guidance on writing the eight.
- Financial Reporting CouncilSustainability reporting developments — frequently asked questions
The government intends to update the 2022 guidance now UK SRS S2 can discharge the disclosures.
- IFRS FoundationIFRS S2 Climate-related Disclosures
The paragraphs that take over each of the eleven.
- Department for Business and TradeUK SRS S2 — Climate-related Disclosures (PDF)
The UK text, including ¶22 and ¶C4.
- Department for Business and TradeUK SRS S1 — General Requirements (PDF), Appendix B ¶¶B45–B47
Cross-reference to another report, which the new listing rule allows.