acca-采掘业气候变化风险相关披露（英）-2021.8-32页_4mb

Summary of Climate Change Risk-Related Disclosures in Extractive Industries

Core Content

This report, authored by ACCA and the Adam Smith Business School, examines the current state of climate change risk-related disclosures in the annual reports of 60 publicly listed extractive industry companies with the highest carbon emissions between 2016 and 2018. The study aims to evaluate the level and depth of such disclosures in both the narrative (front end) and financial reporting (back end) sections of the annual reports, and to identify good practices in climate change reporting.

Main Objectives

• Explore the level and depth of climate-related disclosures in the narrative sections of annual reports.
• Investigate the integration of climate-related information into the accounting policies and financial statements' notes.
• Identify good climate-related reporting practices in both the front and back ends of annual reports.

Key Findings

Front End Disclosures

• Reserves and Resources Reporting: 60% of the sample companies (36) provide a reserves/resources statement with relevant numerical information. However, none of these statements include a detailed assessment of climate change risks.
• Scenario Analysis: Less than a quarter (14 companies) of the sample provide scenario analysis that considers climate change risks. The depth of these disclosures is generally limited.
• Business Model: 60% of the sample companies (36) identify addressing climate change risk as an integral part of their business model. Only 15 of them consider international initiatives such as the Paris Agreement.
• Performance Indicators: Most companies disclose some form of climate-related performance indicators (e.g., carbon emissions), but only four integrate financial and climate-related information.
• TCFD Recommendations: Only 10% of the sample companies (6) disclose that they incorporate climate change risks into their future cash flow estimations as part of their impairment testing.

Back End Disclosures

• Accounting Policies Note: Companies do not typically disclose the effect of climate change on their judgements or estimations uncertainty in the accounting policies note.
• Impairment Testing Note: Climate change risks are rarely considered in impairment testing, with only 10% of companies incorporating them into their cash flow estimations.
• Non-current Assets Note: While most companies capitalise future climate change-related expenses, only 25% (14 companies) use financial instruments to settle future environmental obligations.
• Provisions and Contingent Liabilities Note: Fewer than 30% (17 companies) consider climate change risks in the estimation and recognition of provisions, and only 10% (6 companies) do so for contingent liabilities.
• Auditor's Report: Climate change risk is identified as a key audit matter in only 15% of the sample companies (9 companies).

Main Viewpoints

• Companies in the extractive industries are not sufficiently engaging with climate change risk-related disclosures.
• The information provided in the front end is more detailed and comprehensive compared to the back end.
• There is a disconnect between the narrative and financial reporting sections of annual reports regarding climate change.
• The integration of climate-related information into financial statements is limited, indicating a need for more robust and standardized reporting practices.
• The level of climate change risk disclosures is positively correlated with company size, suggesting that smaller companies may disclose even less than those examined in this study.

Key Information

• The study focuses on 60 extractive industry companies with the highest carbon emissions between 2016 and 2018.
• The research is based on a manual review of annual reports, using two tailored instruments to assess the front and back ends.
• The front end includes narrative sections such as the chairman's and CEO's statements, strategic reports, and ESG sections.
• The back end includes audited financial statements and related notes, as well as the auditor's report.
• The study highlights the importance of improving the quality and depth of climate change risk-related disclosures in financial reporting, particularly in the context of IFRS and related standards.
• The findings suggest that there is a more urgent need for improvement in climate change disclosures than even the empirical data indicates.

Policy Recommendations

• Accounting standard setters should consider the relevance of current financial reporting standards in communicating climate change-related risks.
• Potential amendments to IAS 1, IFRS 6, IAS 36, and IAS 37 may be necessary to improve climate-related disclosures.
• Regulators and auditors should pay more attention to the quality of compliance and the reliability of relevant estimates.
• Companies should integrate climate change risk considerations more thoroughly into their financial reporting and disclosures.

Conclusion

The report underscores the need for more comprehensive and integrated climate change risk-related disclosures in the extractive industries. While companies are beginning to acknowledge the importance of climate change in their narratives, they are not fully incorporating these risks into their financial reporting. This disconnect raises concerns about the consistency, relevance, and decision-usefulness of financial reporting in the context of climate change.