MSCI In Practice: Total Portfolio Carbon Footprinting

In July 2022, we reviewed article of MSCI ESG on the approaches of various regulators on the TCFD, the Task Force on Climate-related Financial Disclosures. As the subject came up on September 27 in the live "MSCI In Practice: Total Portfolio Carbon Footprinting – a baseline for a Net-Zero transition", we will publish again about it.

At the time, we indicated that if, on the one hand, the global effort to standardize climate risk reports is visible through the increase in decarbonization commitments by companies, on the other hand, there is a perception that national financial regulators differ in their requirements and the scope of companies required to do so. That is, investors should pay attention to the comparability and uniformity of reported data. However, one point in common: companies will increasingly publish forward-looking measures, so that investors can assess the ability to transition.

Here is a non-extensive list of regulators and their 2022 cronology of enforcement of TCFD rules:

1. Brazil (Central Bank regulation)

2. European Union (Corporate Sustainability Reporting Directive, first set)

3. Hong Kong (Securities and Futures Commission, major fund managers)

4. India (largest listed issuers, fiscal year 2022-2023)

5. Japan (Financial Services Agency, prime-segment listed companies)

6. New Zealand (External Reporting Board)

7. Singapore (SGX)

8. Switzerland (for large companies)

9. United States (SEC, public comment and Insurance Industry's National Association of Insurance Commissioners)

10. UK (Financial Conduct Authority)

Click on the image below - net-zero regulatory initiatives, voluntary and industry standards - to access MSCI Events' on-demand video, discussing and exemplifying how to analyse, measure and report, including TCFD, the full emissions footprint in a total portfolio, the Total Portfolio Footprinting. In alignment with The Partnership for Carbon Accounting Financials (PCAF) and its Global GHG Accounting and Reporting Standard across all asset classes.