The race is on to put climate change centre stage

By Anne Adrain, ICAS

With the countdown to COP 26 well underway, this article looks at how the race is on to put climate change at centre stage.

Main points:

Sustainability is the key theme for ICAS for the month of June. Throughout June, we will be focussing on the three strands of sustainability: environmental, social and governance (ESG), in our content, events and wider communications. However, climate change is widely viewed as the biggest threat facing mankind.

ICAS is also developing its own sustainability story as part of our Responsible Business Strategy focussing on three themes of Climate Change; Equality, Diversity and Inclusion; and Public Trust. Each of these themes will feature in various content and events taking place during 2021.

As the world begins to count the days to the start of the summer Olympics, a far more importance race for the human race has also begun in earnest. Whether due to the fast-approaching COP26 conference due to be held in Glasgow in November, efforts are now taking place at considerable pace to move the dial in terms of corporate reporting on climate change and other sustainability related matters. There may be no gold medals to be given out in this particular race, but the prize is undoubtedly much greater.

Consequently, the race is now on for all governments, and jurisdictions, to demonstrate the urgency with which they are tackling the issue of climate change. As host of this year’s COP, there is some pressure on the UK to secure a place on the podium.

The UK Government is certainly amongst the front runners at the moment, setting out its aim of making climate-related financial disclosures mandatory for large companies and financial institutions across the economy by 2025. Making this announcement in November 2020, the Chancellor, Rishi Sunak, highlighted that this went further than the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), making the UK the first G20 country to do so.

The government has certainly wasted little time in setting this ambition in motion. In March of this year, the Department for Business, Energy and Industrial Strategy (BEIS) issued its consultation on mandatory climate-related financial disclosures for publicly quoted companies, large private companies and Limited Liability Partnership (LLPs). The consultation period closed on 5 May 2021 and proposed that these disclosures would become mandatory for those entities in scope for accounting periods commencing on or after 6 April 2022. An ambitious timescale, but one which reflects the urgency of the climate emergency and the role that business and the accountancy profession needs to play.

So, who will be the winners of this race? All of us, we hope, if the various world leaders that descend on Glasgow in November step up the pace in the race for the preservation, and survival, of the human race. World leaders must ensure that by the time the baton is passed over to the host of the next major climate conference that the talking has turned into action. Success in a relay depends on each team member playing their part; the same is also true when it comes to making the changes necessary to ensure that we leave an inhabitable planet for future generations.