Which international framework focuses on climate-related financial disclosures?

The Task Force on Climate-related Financial Disclosures (TCFD) is integral in promoting consistent and transparent climate-related financial disclosures across industries and nations. Established in 2015 by the Financial Stability Board, the TCFD aims to help companies provide stakeholders with better information on the financial impacts of climate change. This framework encourages organizations to disclose relevant climate risks and opportunities, assess their financial implications, and integrate these assessments into their financial decision-making processes.

The TCFD recommendations focus on four core elements: governance, strategy, risk management, and metrics and targets. This structured approach allows businesses to clearly communicate how climate change could affect their performance and sustainability, helping investors and other stakeholders make informed decisions based on comprehensive and consistent information.

While the other options listed pertain to important aspects of climate finance and sustainability, none are specifically centered on climate-related financial disclosures. The Green Climate Fund primarily focuses on financing climate initiatives, the Paris Agreement establishes commitments to reduce greenhouse gas emissions among nations, and the UN Sustainable Development Goals provide a broad agenda for sustainable development but do not specifically address financial disclosures related to climate risks. Thus, the TCFD stands out as the clear choice in this context.