How to move transition planning forward from the boardroom

The webinar explored how boards can oversee the development of high-quality transition plans, as well as approaches for integrating climate risk and opportunity into discussions on business strategy. During a fireside chat and Q&A, our panellists shared insights on the practical value of our Transition Planning Toolkit and how it is being used by NEDs in the boardroom.

Key Takeaways

1. Boards need to address the transition to a low-greenhouse gas emissions and climate-resilient economy with the same degree of rigour as they would any other issue that is a significant driver of business risk or opportunity.
2. Transition planning is a key tool to enable companies to integrate the transition required into the company’s strategy and to map the transformation journey.
3. The transition planning process helps identify and inform discussions on risk management but also on opportunities for the business – both of which can catalyse fundamental business transformation.

Practical Insights

1. Governance: Ensure roles and responsibilities are clear at board, committee and executive level.
2. Stakeholder engagement: It is critical to engage internal and external stakeholders during the transition planning process to achieve buy-in and support.
3. Get started: Get started by using the Transition Plan Taskforce disclosure framework and guidance, and our Transition Planning Toolkit. Companies must move forward with transition planning, to manage risks and crystalise opportunities, without having all the answers. The transition planning process is iterative, and each company’s plan will develop over time.

What do Investors Expect?

Investors recognise the financial materiality of sustainability-related risks and opportunities, and many have made commitments to sustainability goals. Investors are increasingly expecting companies to understand what the net-zero transition means for their company, and how the company will respond and contribute to the transition.

As sustainability-related risks and opportunities are increasingly integrated into strategic thinking for the company, there is expectation that board members are involved in and can explain the company’s climate ambition, transition plan, key goals and objectives, the trade-offs, and the financial commitments underpinning it.