How do the best report on climate

Piotr Biernacki

Piotr Biernacki


Share on facebook
Share on linkedin
Share on twitter

If you are still wondering how to best report on issues related to climate or what you can learn from such reports, look no further. A few days ago a report „How to improve climate-related reporting. A summary of good practices from Europe and beyond” was published. I had the pleasure to participate in the work of the EFRAG (The European Financial Reporting Advisory Group) team that prepared the report commissioned by the European Union. The report can significantly facilitate the preparation phase for companies which today try to meet the requirements on non-financial information disclosure that were strengthened last year.


When we started our work precisely one year ago, we were thinking what information can be most useful for companies preparing their reports and for investors and other stakeholders who use these reports. Back then, in February 2019, it was already known that the European Commission would in a few months significantly broaden its requirements in the area of reporting issues related to climate change. Eventually, this was what insurers, banks and investors expected from it. We decided that a set of thoroughly discussed best practices selected from the already existing corporate reports would be most helpful to authors and readers of reports dedicated to climate-related issues.


It is the first compilation of examples from reports which considers both perspectives: not only of the company itself, but also of people who read the report and then make investment decisions based on the information and data they found therein. The study covered nearly 150 reports that were diligently selected to represent issuers from diversified industries and sectors as well as large, medium-sized and small enterprises.


The work was conducted collaterally in two working groups. One of the groups, which I was a member of, analysed the way companies addressed the twelve TCFD recommendations. The recommendations themselves lay ground to the new guidelines of the European Commission. The other working group tackled the most complex part of climate reporting, namely scenario analysis. There is not even a single company among the largest companies listed on the largest stock exchanges that perfectly reports on all climate-related aspects. There is no evidence showing that best reporting practices are to be seen only in reports issued by large companies that have more organisational, human and financial resources. On the contrary, sometimes it was the smaller or medium-sized companies that surprised us with their exceptionally coherent approach to describing climate-related risks and opportunities or with their diligent presentation of climate strategy management process. These are the two very important conclusions which indicate that good reporting does not depend on what resources you have but it depends on how seriously you approach the issues that are, strategically speaking, most important both to the company’s future and its investors as well as other stakeholders.


The common features of best climate-related disclosure boil down to a few points. Firstly, reports that are packed with numbers do stand out. A company which, in line with the standards, measured its greenhouse gases emissions, quantified the effect of particular risks or calculated expenditures necessary to be incurred for the forthcoming years to meet the coming changes was usually better positioned to justify that it would be able not only to survive but also to grow and develop in the coming economic reality. Secondly, companies that were outstanding where those which did not treat climate-related disclosure as compliance homework they were made to do, but approached the task considering the in-depth review of what really was material in the interrelated influence of business, conducted operations and environment. Conclusions from diligent materiality assessment helped ensured consistency of the whole equity story and strongly supported the undertaken strategic decisions and their expected outcomes.


Thirdly, rich commentary to presented data and explanation of observed trends added credibility to reports. This made the reader feel that the management board indeed used the presented performance indicators to make decisions and navigate the company’s activities. On the other hand, there was quite a negative contrast build up by companies which tried to use their reports to boast about superficial achievements, to underline insignificant, although presented as spectacular, “actions” and “projects” or even to do greenwashing.


Lastly, solid climate-related reports were marked by far-reaching honesty. When a company openly stated that some data had not yet been calculated or that a part of risk assessment would be conducted next year, a more coherent picture is created as to the state in which the company is today and what path it has taken to be better prepared for the changes. I am convinced that the report available at will be useful to almost 150 companies listed on the Warsaw Stock Exchange that will for the first time this year try to meet the investor disclosure requirements which are thoroughly described in the new European Commission guidelines, as they prepare their reports covering the year 2019.

Find out what we do regarding sustainability reporting


Registered address
5A Grzybowska St,
Warsaw, 00-132, Poland
Office address:
101 Jerozolimskie Avenue Apt 7,
Warsaw 02-011, Poland

Privacy Policy of MATERIALITY.PL

Read our policy „Privacy Policy”

5A Grzybowska St, Warsaw, 00-132, Poland

All information provided on the website is indicative and does not constitute legal nor any other form of advice. MATERIALITY is not responsible for the use of the information provided on the website without prior seeking professional advice from MATERIALITY experts.