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Environmental risk reporting in annual reports


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Michael Zimonyi's presentation on risk reporting for the XBRL Europe conference in May 2014.

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Environmental risk reporting in annual reports

  1. 1. @CDSBGlobal 1 Environmental  risk  repor0ng  in  annual  reports     Michael  Zimonyi   Project  Officer,  Climate  Disclosure  Standards  Board     XBRL  Europe  workshop  |  5th  May  2014  
  2. 2. @CDSBGlobal 2 Outline   +  Introduc0on   +  About  the  Climate  Disclosure  Standards  Board   +  Emerging  external  repor0ng  drivers   +  CDSB  Framework     +  Concluding  remarks  
  3. 3. @CDSBGlobal 3 “It  is  increasingly  understood  that  financial  statements  capture   less  than  20%  of  corporate  risks  and  value  crea<on  poten<al”   –  MaR  Christensen,  Execu0ve  Director   European  Sustainable  Investment  Forum   Introduc0on  
  4. 4. @CDSBGlobal 4 Introduc0on   +  Financial  statements  capture  less  than  20%  of  corporate  risks  (Eurosif,  IIRC)   +  Increasing  impact  of  climate  change  on  decisions  and  ac0ons  by  management,   investors  &  other  stakeholders   +  Increasing  ESG  repor+ng  requirements  –  UK,  France,  EU,  South  Africa,  US?   +  Increasing  requirement  to  integrate  ESG  informa0on  with  financial  repor0ng  
  5. 5. @CDSBGlobal 5 Breakdown  of  environmental  risk   Aiming  for  natural  capital  repor<ng   38%  climate  change   25%  water   16%  forest   risk  commodi0es  
  6. 6. @CDSBGlobal 6 Water  risk  
  7. 7. @CDSBGlobal 7 Forest  risk  
  8. 8. @CDSBGlobal 8 Climate  change  risk  
  9. 9. @CDSBGlobal 9 About  the  Climate  Disclosure  Standards  Board   +  CDSB  is  a  consor0um  of  business  and  environmental  organiza0ons   formed  at  the  2007  World  Economic  Forum’s  annual  Davos  mee0ng     +  CDP  has  provided  secretariat  support  since  incep0on  and  coordinates   day-­‐to-­‐day  ac0vi0es   Who  we  are  
  10. 10. @CDSBGlobal 10 About  the  Climate  Disclosure  Standards  Board   Who  we  are   +  Supported  by  leading  industrial  &  financial  services  companies,  NGO   representa0ves,  the  major  accoun0ng  firms,  professional  bodies,   academics  and  other  specialist  collaborators    
  11. 11. @CDSBGlobal 11 About  the  Climate  Disclosure  Standards  Board   +  CommiRed  to  the  integra0on  of  climate  change  related  informa0on   into  mainstream  corporate  repor+ng   +  Working  with  others   What  we  do  
  12. 12. @CDSBGlobal 12 About  the  Climate  Disclosure  Standards  Board   +  Engaging  with  Governments,  regulators  and  stock  exchanges  to   develop  best  prac0ce  in  non  financial  repor0ng   What  we  do  
  13. 13. @CDSBGlobal 13 Emerging  sustainability  repor0ng  requirements   +  Australia  ASX  corporate  governance  guidelines   +  Danish  Financial  Statements  Act   +  EU  Accoun0ng  Direc0ves   +  French  Grenelle  II     +  South  African  King  Code   +  UK  Companies  Act   +  US  SEC  Regula0on  S-­‐K   Mandatory  repor<ng    
  14. 14. @CDSBGlobal 14 Emerging  sustainability  repor0ng  requirements   Changes  to  EU  accoun<ng  direc<ves  
  15. 15. @CDSBGlobal 15 Emerging  sustainability  repor0ng  requirements   +  6,000  companies   +  Loca0on  of  non  financial  statement   +  Content:   +  Policies,  results,  risks,  due  diligence   +  Environmental  (plus  social,  employee,  human  rights,  an0-­‐corrup0on,  bribery)   +  The  use  of  renewable  and  non-­‐renewable  energy,  greenhouse  gas  emissions,   water  use  and  air  pollu0on   +  Confirma0on  of  specific  disclosure  requirements  to  follow     Changes  to  EU  accoun<ng  direc<ves  
  16. 16. @CDSBGlobal 16 CDSB  Repor0ng  Framework   +  Prepare  &  present  environmental   performance  &  risk  informa0on  in   mainstream  financial  reports   +  Designed  to  allow  investors  to  assess  the   rela0onship  between  environmental   performance  &  risks  and  the  organisa0on’s   strategy  &  prospects   +  Cross  referencing  other  repor0ng   requirements  (CDP  CC4)   CDSB  Framework  focuses  on  iden<fying  environmental  risk  in  mainstream  reports   Informa0on  in  CDP  and   other  disclosures     CDSB   Framework   Annual  Report  
  17. 17. @CDSBGlobal 17 CDSB  Repor0ng  Framework   +  Focus  of  previous  CDSB  Framework  on   climate  change  risks  &  opportuni0es   affec0ng  an  organisa0on’s  strategy  and   financial  performance   +  Scope  has  now  expanded  into  forest   commodity  risks  and  water   +  The  expansion  of  the  CDSB  Framework  will   now  cover  79%  of  natural  capital   Aiming  for  natural  capital  repor<ng  
  18. 18. @CDSBGlobal 18 The  climate  change  repor0ng  taxonomy  
  19. 19. @CDSBGlobal 19 Climate  Change   Repor0ng  Framework   (HOW  to  report)   CDP  informa0on   request   (WHAT  to  disclose)   Requirements  –  subject  maRer
  20. 20. @CDSBGlobal 20 20 Requirements  –  subject  maRer,  other
  21. 21. @CDSBGlobal 21 Technical  Working  Group
  22. 22. @CDSBGlobal 22  Climate  Change  Repor+ng  Taxonomy    CDP    CDSB   Strategic  analysis,  risk   and  governance   Greenhouse  gas   emissions   Introduc0on   Governance   Strategy   Targets  and  ini0a0ves   Communica0ons   Risks   Opportuni0es   Emissions  methodology   Emissions  data   S1  breakdown   …   What  does  it  look  like?   Basic  architecture  
  23. 23. @CDSBGlobal 23 XBRL  in  prac0ce  
  24. 24. @CDSBGlobal 24@CDSBGlobal @CDSBGlobal   Climate  Disclosure  Standards  Board   Subscribe  to  our  newsleRer  at   Thank  you   Michael  Zimonyi   Project  Officer   Tel:  +44  (0)  7415  7121   Skype:  mikezimonyi