TCFD disclosures · a drafting guide
TCFD disclosures: how to write the 11 recommended disclosures
The 11 recommended TCFD disclosures are short, and the Task Force’s October 2021 guidance says what each should cover.
The four pillars and the recommendations they sit under are on TCFD framework.
This page drafts to that guidance, pillar by pillar, and ends with the explanation a UK listed company gives when a disclosure is missing.
Which rule applies depends on your period: the TCFD statement for accounting periods beginning before 1 January 2027, and UK SRS S2 on a comply-or-explain basis after that.
Before you draft
Three decisions that shape every section
First, decide which rule you are writing to, because the same eleven disclosures sit inside four UK duties with different locations and consequences — the TCFD reporting requirements page sorts them.
Second, fix your time horizons and your organisational boundary once, and use them in every pillar; the Task Force’s principles ask for disclosures that are “consistent over time”.
Third, decide where the disclosures will sit: the TCFD recommended them for mainstream annual financial filings, and every UK rule that adopted the framework put them there.
The seven principles run through what follows: relevant; specific and complete; clear, balanced and understandable; consistent over time; comparable; reliable, verifiable and objective; and timely (fsb-tcfd.org).
The framework itself, verbatim, is on TCFD framework.
Governance · (a) and (b)
The board, then management
Governance (a) asks you to describe the board’s oversight of climate-related risks and opportunities.
Name the committee that holds climate on its terms of reference, say how often it hears about it, and give one decision in the year where climate changed the outcome.
A disclosure that stops at “the board oversees climate risk” describes an intention, not an arrangement.
Governance (b) asks for management’s role, and the Annex lists what to cover: whether climate responsibilities sit with management-level positions or committees and whether they report to the board, the associated organisational structure, how management is informed, and how it monitors the issues.
The chain should be visible end to end — board, committee, named executive, and the functions that do the work.
The Companies Act asks for the same thing in one line at s.414CB(2A)(a): “a description of the company’s governance arrangements in relation to assessing and managing climate-related risks and opportunities”.
The Annex asks, for (a)
“processes and frequency by which the board and/or board committees (e.g., audit, risk, or other committees) are informed about climate-related issues”;
whether they consider climate “when reviewing and guiding strategy, major plans of action, risk management policies, annual budgets, and business plans” and when “overseeing major capital expenditures, acquisitions, and divestitures”;
and “how the board monitors and oversees progress against goals and targets”.
Strategy · (a) and (b)
Risks, opportunities and their effect on the plan
Strategy (a) asks for the climate-related risks and opportunities you have identified over the short, medium and long term.
Give each horizon a number of years and a reason — asset lives, contract terms, the planning cycle — because an unnumbered “long term” cannot be compared year on year.
Use the Final Report’s own vocabulary: transition risks (policy and legal, technology, market, reputation) and physical risks (acute and chronic), each paired with an opportunity where one exists.
Strategy (b) is where the risks land, and the Annex asks for financial effects on performance and position, not only a narrative.
It also says that an organisation which has made emissions-reduction commitments “should describe their plans for transitioning to a low-carbon economy” — the hook for a transition plan, which our climate transition plan guide covers.
The Companies Act splits the same ground into (d), the principal risks and opportunities with their time periods, and (e), their actual and potential impacts on the business model and strategy.
The Annex asks, for (b)
The impact on: products and services; supply chain and/or value chain; adaptation and mitigation activities; investment in research and development; operations; acquisitions or divestments; access to capital.
“Organizations should describe the impact of climate-related issues on their financial performance (e.g., revenues, costs) and financial position (e.g., assets, liabilities).”
Strategy · (c)
Scenario analysis: write down the inputs
Strategy (c) asks you to “describe the resilience of the organization’s strategy, taking into consideration different climate-related scenarios, including a 2°C or lower scenario”.
The Annex adds scenarios “consistent with increased physical climate-related risks” where relevant, and asks where the strategy may be affected, how it might change, the potential financial impact, and the scenarios and horizons used.
It prescribes no provider; two widely cited reference sets are the central banks’ NGFS scenarios and the IEA’s Net Zero Emissions by 2050 scenario, both reissued periodically, so name the edition.
The IEA’s World Energy Outlook 2025 version peaks at around 1.65°C before falling back below 1.5°C by 2100, so it is no longer a limited-overshoot pathway — a detail that changes what “1.5°C-aligned” means in your text.
For physical risk the underlying science is the IPCC’s AR6 Working Group I report.
The successor standard is less demanding on method than people assume: UK SRS S2 ¶22 asks for an approach commensurate with the entity’s circumstances, and ¶B15 accepts scenario narratives alone as a reasonable basis.
What it does ask is that you disclose how the analysis was carried out, so an unexplained conclusion will not survive the move to UK SRS S2.
| Write down | Why |
|---|---|
| Which scenarios, and their vintage | Scenario sets are reissued; an undated scenario dates nothing |
| The horizons modelled | Resilience is always resilience by a date |
| What was held constant | The assumptions an assurer can check |
| What was not modelled | Usually the most useful sentence |
| The effect on the numbers | The Annex asks for revenues, costs, assets and liabilities |
Risk management · (a), (b) and (c)
Show the join, not a second register
Risk management (a) asks for your processes for identifying and assessing climate-related risks: how a risk reaches the register, what makes it significant relative to other risks, and how existing and emerging regulation is considered.
Risk management (b) asks how you manage them — the decision to mitigate, transfer, accept or control, and how climate risks are prioritised.
Risk management (c) is the one that separates a real process from a parallel workstream: describe how climate risk runs through the same register, scoring scale and escalation route as every other risk.
A simple test works: if a climate risk is principal, it should appear in the principal risks table, and a reader who finds it in one place and not the other will notice.
The Companies Act duty makes this concrete at s.414CB(2A)(c): “how processes for identifying, assessing, and managing climate-related risks are integrated into the company’s overall risk management process”.
None of the three carries materiality wording in the TCFD text, so they are the disclosures you should expect to make in full.
Metrics and targets · (a), (b) and (c)
Numbers a reader can check
Metrics and targets (a) asks for the metrics used, and the Annex points to the seven cross-industry categories: GHG emissions, transition risks, physical risks, climate-related opportunities, capital deployment, internal carbon prices and remuneration (2021 guidance).
It asks for historical periods “to allow for trend analysis” and, where not apparent, “a description of the methodologies used”.
Metrics and targets (b) is the emissions inventory, calculated “in line with the GHG Protocol methodology” — see the Corporate Standard and our GHG Protocol guide.
State the Scope 2 method, the factor set and year, the boundary and the restatement policy, and make the figures reconcile with any SECR numbers in the same report.
The Scope 3 work, category by category, is on Scope 3 under UK SRS, and the systems that hold the data are compared on carbon reporting software.
Metrics and targets (c) needs both halves — the target and the performance against it — which means a base year, an interim marker and this year’s position.
The Annex asks, for (b) and (c)
“Organizations should provide their Scope 1 and Scope 2 GHG emissions independent of a materiality assessment, and, if appropriate, Scope 3 GHG emissions and the related risks.
All organizations should consider disclosing Scope 3 GHG emissions.”
For targets: whether absolute or intensity based; the time frames; the base year; the key performance indicators; and interim targets for medium or long-term targets, where available.
Where it goes
Location, by rule
| Rule | Where the disclosures sit | What must be said about location |
|---|---|---|
| FCA listing rule, periods before 2027 | The annual financial report, or another document it points to | Where the disclosures can be found, and why they are elsewhere if they are |
| FCA UK SRS rules, periods from 2027 | The annual financial report, with cross-reference permitted under UK SRS S1 ¶¶B45–B47 | Where the disclosures and explanations can be found |
| Companies Act s.414CB | The non-financial and sustainability information statement in the strategic report | A named framework under s.414CB(6) if UK SRS S2 is used instead |
| FCA ESG 2 entity report | A standalone report on the firm’s website, by 30 June | Prominent placement on the main website |
Comply or explain
When a disclosure is missing, explain it properly
The TCFD listing rule was comply-or-explain from the start, and PS20/17 described what an explanation needs: “an explanation of why, and a description of any steps they are taking or plan to take to be able to make consistent disclosures in the future – including relevant timeframes”.
That rule, UKLR 6.6.6R(8), governs every accounting period that begins before 1 January 2027.
From then the FCA’s UKLR 6.6.6R(7A) takes over for UK SRS S2: a summary of the requirements not met, the reasons, and any steps being taken or planned — with no timeframe.
A reason that could appear in any company’s report is weak evidence of anything; name the data you lack, the analysis you have not yet run, and the decision you have not yet made.
The builder turns your answers into a draft in the shape the rule for your period asks for; it keeps nothing.
How the explanation is judged under the new rules, and the FCA’s draft technical note on it, are on FCA TCFD rule and TCFD and UK SRS.
Draft your explanation
- 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)
Draft
The TCFD limb asks for the reason, the steps and the timeframe (PS20/17; UKLR 6.6.6R(8)). A drafting aid: nothing you type is stored or sent.
What goes wrong
Five failures reviewers keep finding
Text that would describe any company fails the first principle — relevant — before it fails anything else.
“Our strategy is resilient” with no scenarios, horizons or assumptions cannot be verified, which fails the sixth principle by construction.
A 2050 ambition with no base year, interim target or current position answers half of metrics and targets (c).
Emissions in the TCFD section that do not reconcile with the SECR figures elsewhere in the same annual report.
The fifth is length for its own sake: the FRC’s January 2025 review of the first Companies Act reports found inconsistent quality among the companies it examined, and the remedy it points to is more consistent, coherent and concise disclosure, not more of it.
The FRC’s wider view is set out in its sustainability reporting FAQs.
Beyond TCFD
Writing for the report after this one
A listed company’s first UK SRS period begins on or after 1 January 2027, so a TCFD report written this year is also the first draft of that one.
The move, disclosure by disclosure, is set out in the step-by-step TCFD to UK SRS migration; the gaps are easiest to find with the UK SRS readiness assessment.
The standard that replaces the TCFD statement for listed companies is published on the government’s UK SRS page, and the consultation that shaped the FCA’s rules is CP26/5 (PDF).
Assurance is not required by any of these rules; if you obtain it, the FCA’s 2027 rules ask you to name the provider, the scope and the standard, and the UK standards themselves are set by the FRC on its sustainability assurance pages.
The overview of the Task Force and every UK rule that still uses its shape is on TCFD.
Frequently asked
TCFD disclosures, answered
What are the 11 TCFD recommended disclosures?
Governance (a) board oversight and (b) management’s role; Strategy (a) risks and opportunities over the short, medium and long term, (b) their impact on businesses, strategy and financial planning, (c) resilience under different scenarios including a 2°C or lower scenario; Risk management (a) identifying and assessing, (b) managing, (c) integration into overall risk management; Metrics and targets (a) metrics, (b) Scope 1, Scope 2 and, if appropriate, Scope 3 emissions, (c) targets and performance.
Where should TCFD disclosures go in a UK annual report?
Under the FCA listing rule the statement goes in the annual financial report, which must say where the disclosures can be found.
Under the Companies Act the eight climate-related financial disclosures go in the non-financial and sustainability information statement in the strategic report.
An FCA-regulated asset manager publishes its TCFD entity report on its website by 30 June each year.
What should a TCFD governance disclosure cover?
The October 2021 Annex asks for the processes and frequency by which the board and its committees are informed about climate-related issues, whether they consider them when reviewing strategy, budgets, business plans, performance objectives and major capital expenditure, acquisitions and divestitures, and how the board monitors progress against goals and targets.
For management, it asks which positions or committees hold climate responsibilities, how they report to the board, and how management is informed and monitors the issues.
Do I need quantitative scenario analysis for TCFD?
The TCFD asks you to describe the resilience of the strategy under different scenarios, including a 2°C or lower scenario, and the potential impact on financial performance and position. It does not prescribe a method.
UK SRS S2 asks for an approach commensurate with the entity’s circumstances, and its paragraph B15 says scenario narratives alone can provide a reasonable basis.
Which time horizons should a TCFD report use?
The TCFD does not fix them.
Strategy (a) asks for risks and opportunities over the short, medium and long term, and the Companies Act asks for “the time periods by reference to which those risks and opportunities are assessed”, so the horizons you choose must be stated and should follow the life of your assets and plans.
Is Scope 3 required in a TCFD report?
The TCFD asks for Scope 1 and Scope 2 emissions independent of a materiality assessment and Scope 3 “if appropriate”, and its 2021 guidance says all organisations should consider disclosing Scope 3.
The listing rule is comply-or-explain, so an omission needs an explanation.
UK SRS S2 requires Scope 3, with a relief.
How do I explain a TCFD disclosure I have not made?
For a period beginning before 1 January 2027 the listing rule asks which recommendations or disclosures were not made, why, and the steps and timeframe for making them.
For a period beginning on or after that date the UK SRS S2 limb asks for a summary of the unmet requirements, the reasons and any steps being taken, with no timeframe.
What mistakes do TCFD reports most often make?
Boilerplate that could describe any company, scenario analysis that asserts resilience without stating the scenarios, horizons and assumptions, targets without a base year or interim milestones, and emissions figures that do not reconcile with the SECR numbers in the same annual report.
The FRC’s review of the first Companies Act reports found inconsistent quality across the companies it examined.
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 DisclosuresRecommendations — the eleven and the seven principles
The disclosure text each section below drafts to.
- TCFD (Financial Stability Board)Implementing the Recommendations — October 2021 Annex, Guidance for All Sectors
What the Task Force asks each disclosure to cover.
- IFRS Foundation (archived TPT material)TCFD Recommendations and Guidance — TPT technical mapping, October 2023
Reproduces the 2021 Annex guidance for each disclosure verbatim.
- TCFD (Financial Stability Board)Guidance on Metrics, Targets, and Transition Plans, October 2021
The seven metric categories and the elements of a transition plan.
- TCFD (Financial Stability Board)Final Report, June 2017
Transition and physical risk categories; disclosures in mainstream filings.
- FCA HandbookUKLR 6.6.6R(8) — the TCFD statement
The consistency statement and the explain limb, for periods beginning before 1 January 2027.
- Financial Conduct AuthorityPS20/17 (PDF) — the listing rule as introduced
The explain limb: why, the steps, “including relevant timeframes”.
- Financial Conduct AuthorityPS26/19 (PDF), Appendix 1 — UKLR 6.6.6R(7A)
The UK SRS S2 explain limb from 2027: summary, reasons, steps, no timeframe.
- FCA HandbookESG 2.1 and 2.2 — TCFD entity reports
Asset managers and owners: consistency with the Annex, and explaining data gaps.
- legislation.gov.ukCompanies Act 2006, section 414CB(2A)
The eight company-law disclosures most UK preparers also make.
- Department for Business and TradeUK SRS S2 (PDF), ¶¶22, B15, 29(a), C4
Scenario analysis commensurate with circumstances; narratives alone may suffice.
- Network for Greening the Financial SystemNGFS Scenarios Portal
A reference scenario set; vintage-dated, and required by no rule.
- International Energy AgencyWorld Energy Outlook 2025, chapter 8: Net Zero Emissions by 2050
Warming peaks at around 1.65°C about 2050 before falling below 1.5°C by 2100.
- IPCCClimate Change 2021: The Physical Science Basis (AR6 WGI)
The physical-science basis behind physical-risk scenarios.
- GHG ProtocolCorporate Accounting and Reporting Standard
The method the Annex names for emissions.
- Financial Reporting CouncilSustainability Reporting Developments: FAQs
The FRC’s own account of TCFD, UK SRS and the Companies Act.
- Financial Reporting CouncilSustainability assurance
Where the UK’s assurance standards for these disclosures are set.
More on TCFD in the UK: TCFD · TCFD framework · TCFD reporting requirements · FCA TCFD rule · TCFD and UK SRS · step-by-step TCFD to UK SRS migration · climate-related financial disclosures · TCFD reporting software