The ICT sector has an important enabling role to play in the transition to a low-carbon economy. At the same time, the sector is at risk from the physical and transitional impacts of climate change.
GeSI’s Climate Scenario Analysis Framework is aligned to the TCFD recommendations and will help companies carry out climate scenario analysis in line with current best practice.
This Framework will enable the ICT sector and other industry sectors to share consistent, transparent disclosures with the investor community outlining the positive financial implications of climate related opportunities.
Conducting a climate scenario analysis will lead to more informed investor decisions and financing of the ICT enabled low carbon transition.
The Global Enabling Sustainability Initiative launched its Climate Scenario Analysis Framework to help companies align with the Taskforce on Climate-related Financial Disclosures (TCFD) and understand the financial impact of climate change on their bottom-line. It provides an adaptable framework for ICT sector companies to follow. It’s intended to facilitate internal discussions and provide scenario analysis outputs.
A key recommendation of the TCFD is for organizations to conduct scenario analysis in order to understand how different climate futures could affect their business. Assessing the financial implications of climate-related risks and opportunities is not an easy task due to the uncertainty over the timing of climate impacts, the range of potential business consequences and the range of potential business consequences.
This guide provides a Scenario Analysis Framework to enable companies to begin to construct their own climate scenario analysis and align to the TCFD recommendations. Companies can use and adapt the Framework in multiple ways, depending on their specific needs.
Consistent and transparent disclosure around climate-related risks and opportunities will allow investors to make better decisions when allocating capital, resulting in more stable and resilient economies.
The Climate Scenario Analysis Framework is structured around the climate-related scenario process recommended by the TCFD. It outlines a three-year roadmap so that processes become part of a company’s risk management, strategic planning and disclosure procedures.
GeSI’s Framework enables a company to work through a process to assess the materiality of climate-related risks and opportunities, identify and define a range of climate scenarios, evaluate the financial impact and identify potential responses.
While ambitious action is needed from all sectors to transition to a more sustainable, low-carbon economy, the ICT sector has a key role to play in enabling the transition, by providing the technological development and data capabilities to disrupt markets and advance sustainable solutions. Identifying and managing climate related risks and opportunities will help prepare businesses for future regulatory disruption and cost, and will help identify new markets and revenue streams.