NEW GUIDANCE: Nine questions that Non-Executive Directors should ask boards today

NEW GUIDANCE: Nine questions that Non-Executive Directors should ask boards today

Acclimatise and Asia-Pacific’s largest law firm, Minter Ellison, are pleased to launch new guidance to assist Non-Executive Directors (NEDs) exercise oversight of corporate action on physical climate risk management. This guidance, prepared for the global Directors’ climate forum, Chapter Zero, brings leading physical risk and legal expertise to bear on an issue that represents one of – if not the – key challenge facing corporates today: How can business build resilience and thrive in the context of a changing climate?

The physical impacts of a changing climate are impacting businesses today, modifying a suite of risks that may previously have been viewed to be managed. These impacts – which are affecting firms, their key stakeholders and supply chains, and customers – risk undermining the foundations of corporate value (including reputation value) and placing constraints on the accomplishment of strategic objectives. Critically, these risks are becoming translated into foreseeable material financial risks and liability risks.

The physical impacts of climate change also raise important far-reaching structural and long-term implications across a host of factors that affect companies. These include access to critical material inputs, labour supply, household income, demand for goods and services, and ecosystem health.

At the same time, investor, insurer and regulatory expectations are increasing, with the disclosures aligned with the Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) on a course to becoming mandatory in several jurisdictions.

The real physical risks facing firms and the evolving regulatory landscape both create growing urgency on the need for corporates to understand, assess and disclose physical-related climate risks and opportunities. In their oversight capacity, NEDs have a unique and powerful role to play in driving Board-level action on climate risk. By being prepared with key facts and probing questions, NEDs can help improve Board accountability and ensure that key – potentially overlooked – issues are being addressed.

This guidance is designed as a ‘pick-up-and-use’ tool to be used in the boardroom setting today, listing nine key questions (and follow-up questions), covering themes ranging from climate impacts to liability, that NEDs can ask company Directors. The questions are applicable across all sectors, globally. In due course, we intend to release questions targeted at specific sectors.

The guidance also includes a short scientific summary and an overview of recent developments in the disclosure and regulatory landscape.

Access the guidance here.

Contact us at: r.bater(at)acclimatise.uk.com

Click here for more information on Acclimatise’s TCFD-aligned disclosure services.

Click here to learn more about Acclimatise’s corporate climate risk and adaptation services.


Cover photo by Patrick Mueller on Unsplash.

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