Climate-Related Financial Regulation Explorer
As the financial and economic impacts of climate change are becoming better understood, a number of governments have taken steps to foster greater transparency, including through adopting mandatory climate risk disclosure and supply chain due diligence. With climate change risks to companies and financial sector expected to continue to rise in coming years, more governments are expected to tighten regulations around disclosure and due diligence. In this ever-evolving landscape, this interactive online platform will provide up-to-date information on existing and emerging regulatory regimes and due diligence laws around the world.
Updated as of April 2024.
More about supply chain due diligence
Countries are also adopting due diligence obligations, which require companies to evaluate and mitigate risks in their supply chains, particularly in relation to human rights abuses and environmental violations. To conduct effective due diligence and avoid potential sanctions, companies need to monitor supply chains, review their activity, and identify future risks. A cornerstone of due diligence frameworks is the traceability of commodities and raw materials, which will be crucial to ensuring that companies avoid supporting environmental degradation, including deforestation. In addition to the possibility of fines and violations, reputation risks for companies are also likely if they violate due diligence requirements, undermining their brand image with sellers, consumers, and regulators.More about climate risk disclosure
Mandatory climate risk disclosure is becoming part of the rapidly changing regulatory landscape. The new requirements have the potential to significantly change how public companies measure, report, and address risks from climate change. The purpose behind many of the new disclosure requirements are to help companies mitigate financial and physical risks from climate change, while also creating frameworks for clear, consistent, and comprehensive climate-related information that are useful to investors. Many of the required standardized disclosures that have been adopted are in line with the Task Force on Climate-Related Financial Disclosure (TCFD), which in 2017 provided recommendations for transparency around government, strategy, risk management, and metrics/targets.