CLIMATE-RELATED risks will have financial disclosure impacts in the Philippines, according to Willis Towers Watson (WTW), citing the lack of expertise in managing climate risks and the availability of data as major obstacles.
Starting in 2023, listed companies in the Philippines will be required to comply with the sustainability reporting guidelines of the Securities and Exchange Commission (SEC), the global advisory, broking and solutions firm said.
It added that more firms need to undertake climate financial reporting based on the recommendations of the Task Force on Climate-related Financial Disclosure (TFCD).
The TFCD has created a framework to help listed firms disclose climate-related risks and opportunities through existing processes, while the sustainability reporting guidelines issued by the SEC aim to help them in managing non-financial performance covering environmental, social and governance of organizations.
According to WTW, about 24% of publicly listed firms in the Philippines have disclosed or have shown readiness to issue their processes for identifying, assessing, and managing climate-related risks or opportunities. More than half or 55% of the respondents intend to disclose such information.
WTW also said that challenges faced by companies include a shortage of in-house capability on climate risk, as well as a lack of data availability and standardized metrics. — Ashley Erika O. Jose