The IoD has welcomed the Chancellor’s announcement that reporting climate impacts against standards set out by the Taskforce for Climate-related Disclosures will become mandatory for many UK companies, a position that reflects the IoD’s consultation submission.
Three quarters of IoD members have said the UK’s corporate governance regime should change to take greater account of climate impacts.
Dr Roger Barker, Director of Policy and Corporate Governance, said:
“What gets measured gets changed. The problem is there’s a hundred and one different ways of measuring climate impact out there right now. It’s a confusing landscape for companies and investors alike, so bringing in common standards is absolutely the right thing to do.
“Aiming to make the framework mandatory is sensible, as it already provides significant flexibility for companies. Depending on what size of companies must report, there’s a chance some may need support, but the Government deserves plaudits for leading the world on this front.”
On the announcement of a review into the UK’s overseas regime, aimed at encouraging high-growth firms to list in the UK, Roger Barker said:
“The UK is an attractive destination for business across the globe, but we shouldn’t rest on our laurels. Directors and investors will welcome any attempt to further our advantage, particularly as we strike out on our own after Brexit.
“However, this review must start by recognising that one of the UK’s greatest strengths is our high standards for corporate governance. Watering down rules might seem tempting, but could chip away at our key selling point in the long run.”