Companies ‘slow’ to disclose costs of climate change: report

U.S. and European companies in polluting industries rarely disclose the financial risks they face related to climate change even though a global task force called on them to do so two years ago, Moody’s Investors Service said in a report on Monday.

The analysis of the public filings of 28 building materials, oil and gas and utility companies comes after the Financial Stability Board’s Task Force on Climate-related Financial Disclosures in 2017 recommended voluntary disclosure by companies of the financial impact of climate change. The FSB co-ordinates financial rules for G20 countries.

Though 80 per cent of the companies in the Moody ’s sample said climate change was affecting strategic decisions, just two of the 28 linked their climate projections with an effect on cash flows and balance sheets, the report said.

Those companies were a European utility and U.S. oil and gas company, it said without giving names.

Companies it used in its analysis have a combined US$877 billion of debt.

They included Exxon Mobil Corp, Royal Dutch Shell Plc, Duke Energy Corp and Élétricité de France SA, among others.

“Although companies have made some progress in the level of disclosure they provide, standardized and consistent quantification of the financial impact from climate risks is still in a nascent stage,” Vincent Allilaire, one of the authors of the report, said in a statement.

Moody’s characterized the widespread adoption of climate-related disclosures as “slow and gradual.”