By KATIE DODD
The firm stands behind both initiatives.
Fundamentally, we believe that the ideas and work behind the recommendations laid out by both the Paris Agreement and the TCFD are admirable and forward thinking in what they aim to achieve
As a major global pact, The Paris Agreement is undeniably a step in the right direction for countries to act together to reverse the effects of climate change. The goal to limit global warming to 1.5 degrees Celsius over pre-industrial levels is ambitious in the context of an international treaty. While it is unclear how legally binding the commitments made are, it acts as an important framework for pressure points to be applied on those who may effect change.
The work of the Task Force on Climate-Related Financial Disclosures (TCFD) aligns well with the thinking of Cerno Capital as a firm with regards the inclusion of ESG within investment decision making. Philosophically, the recommendations laid out by the TCFD agree and support those of the Paris Agreement. The TCFD is focused on practical steps to support investor decision making through enhanced disclosure. The standardisation of ESG data within financial reporting, as recommended by the TCFD, would improve the ability of investment managers to integrate ESG. Indeed, through implementation at a company level these recommendations offer a complimentary set of tools to the Paris Agreement.
Whilst these initiatives are a step in the right direction in the on-going battle against climate change, we believe that more can and should be done to ensure action is taken.
For more information on the Cerno Capital approach to Responsible Investment, please view our Stewardship statement here.