Climate-related disclosure reports update
The materials and information on this page are designed to help you understand the new Product-level Task Force on Climate-related Financial Disclosures (TCFD) reports set out by our regulator Financial Conduct Authority (FCA) to comply with the Policy Statement 21/24 and what we are doing to meet them.
Your Guide
TCFD One Pager
Find the reports
Adviser Q&A
1. What is TCFD?
Following the Paris Agreement, adopted in 2015, global commitments have been made to combat climate change. The Task Force on Climate-related Financial Disclosures (TCFD) was set up to produce a common global framework for companies to report on how climate change affects their businesses. It published a set of recommendations on the way firms should report their climate-related risks and opportunities as we move to a net zero economy.
The aim is to provide investors with better information so that they can understand the potential impact of the way their monies are invested on climate change and where they choose to invest.
The FCA has made rules which apply to asset managers and certain FCA-regulated asset owners to make mandatory Climate-related disclosures consistent with the TCFD’s recommendations.
2. What are the level Climate-related disclosure reports?
We are complying with the FCA’s Policy statement 21/24 (Enhanced Climate-related disclosures by asset managers, life insurers and FCA-regulated pension providers). The Climate-related disclosure reports, referred to as Product-level TCFD reports, are produced in accordance with regulations from the FCA and compliant to recommendations of the TCFD.
The Climate-related disclosure reports refer to an individual investment fund, a with-profit fund, or several funds making up an investment portfolio e.g., a default arrangement.
The Climate-related disclosure reports contain generally accepted climate metrics that measure the climate impact of investments, specifically for this year greenhouse gas emissions (the number of carbon emissions that a company is responsible for) and carbon intensities (i.e. measures the carbon efficiency of an investment, associated with investment portfolios on the climate) of each portfolio.
The carbon metrics are published by asset class: Equities and Corporate Bonds, and Sovereigns, to take into account the differing carbon emissions methodologies between asset classes. Equity and Corporate Bonds emissions are based on the GHG emissions of the issuing company, while Sovereign emissions are calculated based on country level GHG emissions.
There are three types of emissions we consider:
- Scope 1 (direct)
- Scope 2 (indirect)
- Scope 3 (from a company’s value chain)
This year, we are publishing numbers for Scope 1 and Scope 2. From next year, we anticipate that we will include Scope 3 but the current data isn’t sufficiently established. We want to make sure any information we use is reliable before we incorporate it into our reports.
3. How can I interpret the metrics in the Climate-related disclosure reports?
The Climate-related disclosure reports are designed to provide an additional data point for investment decisions; however, decisions should not be solely made based on this report. It is not an interpretation of the climate metrics or an investment recommendation.
For more detail on what the numbers mean and how we measure them, check out Your Guide to Climate-Related Disclosure Reports.
4. Can I use the Climate-related disclosure reports to compare Aviva products with those of other providers?
The Climate-related disclosure reports are designed to provide transparency and insights into the climate metrics of Aviva Life’s investment products. While you can use these reports to evaluate and compare the sustainability performance within Aviva Life's product range, it is important to note that the metrics and methodologies may differ across providers, making direct comparisons challenging. We encourage you to consider the reports as a valuable tool for understanding the sustainability of Aviva Life's products.
5. Where can I find the Climate-related disclosure reports and how often will Aviva publish them?
We will provide up-to-date information on an annual basis and publish them in the annual statement and/or bonus statement. The relevant Climate-related disclosure reports will be hosted on aviva.co.uk/ESG-Reports.
Reports are published for the reporting year 1 January to 31 December, and the annual metrics calculation date is 31 December.
6. How can I use the Climate-related disclosure reports when advising clients?
Inform your clients: Use the reports to help your customers understand the climate impact of their investments.
Tailor recommendations: Personalise your recommendations based on each customer’s sustainability preferences using the data and metrics provided in the reports.
Incorporate climate-consciousness into your conversations: Diversify your product offering by discussing the benefits of these climate reports as part of investment decisions. The Climate-related disclosure reports will demonstrate how funds align with client’s preferences.
Address client queries: Be prepared to answer client’s questions about the purpose and significance of the Climate-related disclosure reports, providing high-level guidance on interpreting the metrics.
7. Will Aviva Life provide ongoing support and updates related to the Climate-related disclosure reports?
Absolutely. We are committed to providing ongoing support and updates to ensure you have the necessary information and resources to navigate the Climate-related disclosure requirements. Our Investment Services team is available to answer any questions you may have. You can reach out to ginvest@aviva.com for support.
For more information on the Climate-related disclosure reports please visit the one page summary.