Out-Law Analysis 4 min. read

The infrastructure TCFD reporting journey – going from beginner to leader

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Infrastructure companies are expected to improve their performance against climate targets. As participants in a high-emitting industry they must make significant changes, including making financial disclosures to prove what they are changing and doing to actively mitigate climate risk.

But how do owners, contractors, consultants and suppliers go about making the changes to their business that will then be reported on in order to meet the expectations of regulators, investors end users and industry bodies such as the Taskforce for Climate-related Financial Disclosures (TCFD)?

The TCFD, set up by the G20 Financial Stability Board, asks that companies publish better information about the climate impact of their actions so that investors can reliably invest in organisations which can demonstrate their climate credentials. It is setting standards so that reporting is done in a consistent and credible way and provides a flexible, four pillar, framework for businesses to use when approaching climate risk management, regardless of the level of maturity.

To aid infrastructure companies in their TCFD journey, we have divided infrastructure companies into three types: beginner, intermediate and leader. They can use our tools to assess where they currently stand: there is specific guidance for asset owners; project consultants; contractors and suppliers.

That should not be enough though: companies will want to improve their capacity for reporting as part of an industry move towards net zero, and also as a way of accessing the increasing amount of capital and investment that will only be available to climate crisis-abating projects.


Becoming a beginner is an important first step. This is not about achieving everything the TCFD requires all at once, but about establishing the foundations for future action.

That starts with some achievable practical steps:

  • Understand the gaps: look at what your existing reporting looks like against the TCFD’s 11 recommended disclosures and use this to identify what you’re missing.
  • Build your team: implementing the TCFD will be a team effort and you need people to take ownership all over your organisation, including from strategy, finance, risk and the climate or sustainability team.
  • Use what you have: you are probably already reporting on your greenhouse gas emissions; you may already have responded to charity CDP’s climate questionnaire. Use the information you already have as a starting point.
  • Build a plan: once you have gathered the information you already produce and identified where the gaps are, make a plan on how you will fill them. The plan should have clear actions and owners for each one; will have timetables and a mechanism for accountability. Sharing this with internal and external stakeholders will make the process transparent and will demonstrate to investors your commitment to the TCFD process.
  • Integrate: make sure that climate is a factor in your everyday business planning processes. Governance, risk management, budgeting and resource allocation should all incorporate an understanding of the climate impact.


If, as a beginner, you have created a strong foundation of reporting and data gathering and integrated climate into your business planning then you can increase your understanding of climate risks and opportunities and build them into your strategy.

Intermediate companies should:

  • Report on greenhouse gas (GHG) emissions: it should not be very difficult to collect the data from existing reporting systems to calculate what emissions are generated directly by your operations (scope 1) and your electricity usage (scope 2). Though it will be more difficult to calculate scope 3 emissions, which are those generated in your supply chain, by your investments and by the lifetime use of your products or services, this is still an important element of reporting.
  • Use data analysis tools: you should increase the sophistication of your thinking about climate impact by seeking out and using climate modelling tools specific to your industry and economic analyses relating to decarbonisation policy and regulation.
  • Analyse risk: use the categories of risk identified by the TCFD in its recommendations report to discuss with people from across your company what the risks in their area might be. Then seek sources of data to quantify this risk so that you can carry out sound, evidence-based analysis of the risks generated by your business. You might use public and commercially available tools to support analysis such as that provided by the UN’s environment programme.
  • Lead from the front: the leaders of the organisation are crucial in ensuring that climate action is integrated into every business function and is not treated as a standalone item. Climate risk should be on the agendas of boards and sub-committees, and leaders must take on responsibility for oversight of climate issues such as legal and climate liability; climate science and scenarios; net zero, and transition planning. If leaders are not in a position to do this now, training should be sourced that can ensure they monitor activities for climate risk, impact and opportunity.
  • Imagine the future: climate change will have an impact on your business. Physical and transitional climate risks and opportunities are a reality and should be planned for through scenario planning. If scenario planning is not a process the organisation is familiar with some outside help may be required. Start by picking one region or sector for a pilot scenario planning exercise.


Becoming a leader on TCFD standards is about taking the increased sophistication of the intermediate approach and making it a core part of how you do business. You should be embedding climate risk and analysis into every element of business planning and execution, as outlined in our fuller guide to TCFD compliance.

  • Extend scenario planning: having piloted scenario planning and got used to how it works, extend it to all areas of your business. Develop narrative outlines for different scenarios and explore the potential impact these would have on different risks and opportunities. Focus more deeply on regions or business divisions where there are areas of particular concern. Use what you learn to frame your strategy and business planning.
  • Make climate just another risk: you will now have a mature understanding of climate risk so it should no longer be a separate item. It should be fully integrated into your existing enterprise risk management process. Along the infrastructure value chain, this may also include consideration of how climate risk requirements are integrated into elements such as preacquisition due diligence; client project advisory, or supplier and contractor selection criteria.
  • Measure: you have identified climate related risks and opportunities and embedded them in your business planning. Decide how you are going to measure risk and success, then generate targets. Make sure you report against those as you would on any other metrics. Where possible ensure these are consistent with sector peers to support comparability in disclosure for investors.
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