The Transition Plan Taskforce (TPT) has published its final set of resources to complement its best practice disclosure framework, including papers on sector specific guidance and how to undertake a transition planning cycle.
The TPT launched its ‘best practice’ disclosure framework for climate transition plans last October and has now released the final guidance papers this week in order to help companies and financial institutions to mobilise transition finance.
Sector-specific transition plan guidance for asset owners and managers, as well as guidance on how to undertake a transition planning cycle, are among several papers published by the TPT to support the creation of consistent, comparable company reports, and reduce the level of disclosure complexity faced by firms.
Dr Ben Caldecott, co-head and secretariat of the TPT, said that net-zero targets need to be backed up with “firm plans”, including climate transition plans.
“If suitably ambitious and delivered with appropriate actions and with proper accountability, climate transition plans can help society allocate capital to companies and assets that are actually contributing to meeting the aims of the Paris Agreement, and away from those that aren’t. The Transition Plan Taskforce has made available a globally applicable set of resources to help companies build their transition plan and successfully raise transition finance.”
Sector guidance
The TPT has published two types of sector guidance to complement its disclosure framework: the TPT Sector Summary and the TPT Sector Deep Dives.
The TPT Sector Summary provides an overview of transition plan guidance for 30 financial and real economy sectors. It has been designed as a practical guide to give preparers and users of transition plans a glance at key information and guidance sources, with each sector having access to a summary of the recognised decarbonisation levers, metrics and targets, as well as key sources of guidance for a transition plan in that sector.
Meanwhile, the TPT Sector Deep Dive guidance provides sector-specific guidance for preparers to interpret the disclosure framework for seven sectors, including asset owners, asset managers, banks, electric utilities and mining. These sectors were chosen given each sector’s greenhouse gas emissions, its need for (or its provision of) transition finance in the UK context, and the quality of existing guidance available in the market.
Founded in 2021 at COP26, the TPT’s disclosure framework and wider materials have been shaped through engagement and testing with over 600 organisations in the UK and globally, across finance, the real economy and civil society. This includes major firms with global footprints operating in numerous jurisdictions, as well as representatives from emerging and developing economies.
According to the TPT, their work is attracting “significant interest” from other jurisdictions, such as Australia, Brazil, the European Union, France, Germany, Hong Kong, Japan, Malaysia, New Zealand, Singapore, Thailand and the United States. They have also engaged with international coalitions of central banks, supervisors and regulators, as well as multilateral processes such as the G7, G20 and UNFCCC.
TPT co-head and secretariat, Kate Levick, added: “There is international momentum for transition finance and transition plans are increasingly seen as a key tool. The G7, G20 and UN Secretary-General, regulators in other jurisdictions and users of market information support the development of consistent transition plans to inform decision-making and investment. Companies should make a start now rather than risk being left behind.”
Last November, the TPT launched a consultation on guidance to help companies in the private sector prepare their climate transition plans, including for asset managers and owners, and banks.
