COP26 has been pretty significant for finance departments. In the past two weeks I have written about the need for Climate Scenario Planning and then a few days after this blog the UK Government revealed legislation that will require large UK organisations to have Net-Zero climate change scenarios by 2023. I did also say at the end of this second blog:
‘We now need to consider the implications and details of what will become a new form of statutory reporting for climate information! But that is for another blog…’
Well, this is it.
Plus, it got a bit more complicated on the way. Because, also at COP26 the IFRS Foundation announced the formation of the International Sustainability Standards Board (ISSB). This new board combines the Climate Disclosure Standards Board (CDSB—an initiative of CDP) and the Value Reporting Foundation (VRF—which houses the Integrated Reporting Framework and the SASB Standards). You can expect these guys to come up with a whole load of climate reporting requirements on top of those from the UK Government!
Finance has been here before with requirements to report information above and beyond the traditional financial numbers contained in annual reports and statutory disclosures. Experience has shown that a significant number of organisations leave dealing with additional reporting requirements to the last minute and end up stitching together a bunch of spreadsheets to get the job done.
We all know the problem with spreadsheet ‘solutions’ of this kind that include the risk of transcription errors or undetected formula errors and the lack of security and governance. The good news is organisations do have time to put in place the right sort of processes and systems that will avoid resorting to spreadsheets. With the advent of Cloud based Enterprise Performance Management (EPM) solutions implementation can be achieved quickly and successfully, and at a cost all but the very smallest organisations can afford.
Whilst we don’t have definitive details of what all the new reporting requirements are going to be organisations do have some inclination what is coming from the UK Task Force on Climate-related Financial Disclosure (TCFD) and from the International Sustainability Standards Board (ISSB). Working with this information, now is the time to access current reporting processes and systems and take action where required to ensure these will be fit for purpose when the new requirements become law. What we have seen is that a number of organisations are already taking action now and reporting in advance of legislation as investor and stakeholder interest is already high and can only get higher post COP 26.
If you would like to discuss reporting and planning processes and solutions for climate disclosure and climate scenario planning, why not message me on LinkedIn or contact me via the contact page on our website HERE. We are always happy to discuss these and other planning and reporting requirements, with no pressure, as in our experience we can learn as much from you as you will from us!
Until next time
For more useful Oracle Cloud EPM and NetSuite ERP blogs posted by my colleagues, see the Brovanture website HERE