"This week’s announcement of mandatory disclosures of climate-related
risks for companies and financial institutions is arguably the New
Zealand government’s most significant climate policy — even more so than
the Zero Carbon Act itself.
The new policy will come into effect in 2023. It requires all banks,
asset managers and insurance companies with more than NZ$1 billion in
assets to disclose their climate risks, in line with the emerging global
standard from the Task Force on Climate-related Financial Disclosures
(TCFD). This is a smart move, as it ties risk disclosure to
international best practice, which is likely to evolve in the coming years.
There will be a collective gulp in bank boards and company risk
management departments of the roughly 200 affected entities, but
initiatives such as the Aotearoa Circle Sustainable Finance Forum show a
growing proportion of the financial sector understands climate risk
disclosures are necessary.
I have criticised this government’s climate policy in the past for being
big on promise but short on concrete policies. But this financial
disclosure policy has some real teeth."
*** Xanni ***
Chief Scientist, Xanadu
Partner, Glass Wings
Manager, Serious Cybernetics