The AMF is calling for greater Transparency, urging companies to better reflect their actions and risks related to climate change in their financial reports. This initiative comes at the height of the earnings season, when many listed companies disclose their financial performance.
Transparency and Financial Impact
According to the Autorité des marchés financiers (AMF), there has been an increase in the information provided by companies on the financial impacts of climate change, as well as on their commitments to reduce CO2 emissions. However, the AMF points out that there are still gaps in the way some companies report on how they have integrated their climate commitments into their current or future performance.
The consequences of climate change are not limited to theenvironment, but have a significant impact on corporate finances. Extreme weather events, stricter environmental regulations and investor pressure for sustainable practices are all factors influencing financial performance. It is therefore imperative that companies communicate transparently about their exposure to climate risks and the measures they are taking to address them.
Coherence and Communication
The AMF stresses the importance of ensuring consistency between financial statements and other communications related to climate commitments, notably greenhouse gas emission reductions and decarbonization plans.
Consistent communication is essential for investors and stakeholders. Clear and precise communication enables shareholders to better assess the company’s past and future performance, taking into account its sustainable development strategy. This transparency boosts investor confidence and can improve access to long-term financing.
Impact Assessment
The institution recommends that companies continue to assess the positive and negative impacts of climate change and the commitments made in their impairment tests. In addition, the AMF encourages companies to incorporate new key assumptions, such as changes in the energy mix and the rising cost of greenhouse gas quotas, into their financial projections.
Climate impact assessment is not simply a matter of complying with current regulations. It requires an in-depth analysis of the risks and opportunities associated with climate change. Companies that anticipate these challenges will be better prepared to cope with future disruptions and capitalize on the benefits of a low-carbon economy.
Transparency in Green Energy Contracts
As far as green energy contracts are concerned, the AMF notes that companies are increasingly communicating, but deplores a lack of transparency regarding volumes purchased and the duration of supply.
Green energy contracts are becoming increasingly common as companies seek to reduce their carbon footprint. However, transparency is essential to assess the real impact of these efforts. Investors and stakeholders need to know to what extent companies are sourcing green energy, for how long and at what cost. This information enables us to measure companies’ real commitment to sustainability.
In Somme, the AMF is urging companies to communicate better on their climate change actions and to ensure greater transparency in their financial reports. This approach aims to enable investors and stakeholders to better assess the impact of climate change on company performance and prospects. Transparent communication builds trust and fosters a more stable financial environment in a world facing growing climate challenges.
