TCFD-aligned disclosure guidance for public sector annual reports
Applying the Task Force on Climate-related Financial Disclosure (TCFD) recommendations in central government and, where appropriate, the wider public sector
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This guidance supports public sector bodies to include climate-related financial disclosures in their annual reports, in line with the Task Force on Climate-related Financial Disclosures (TCFD) framework.
Who this applies to
The guidance applies to all ministerial and non-ministerial departments, as well as other central government (e.g., larger Arms Length Bodies) and wider public sector bodies that meet certain criteria or are directed to follow it by their relevant authority or parent department. Other bodies may choose to apply the guidance voluntarily, in full or in part.
When this applies from
HM Treasury has adopted a three-year phased approach to implementation for central government, on a ‘comply or explain’ basis. Other public sector bodies should follow the direction set by their relevant authority[1].
What the requirements are
Phase 1 (2023-24)
In-scope reporting entities must include the following in their annual reports and accounts:
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a TCFD Compliance Statement - summarising compliance, any gaps, and plans for improvement
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Governance disclosures:
(a) the board’s oversight of climate-related risks and opportunities
(b) management’s role in assessing and managing climate-related issues
- Metrics and Targets disclosures:
(b) Scope 1 and 2 greenhouse gas (GHG) emissions with Scope 3 emissions where they are deemed material[2].
Phase 2 (2024-25)
This application guidance[3] is additive. Building on Phase 1, Phase 2 requires:
- Risk Management disclosures:
(a) on the processes for identifying and assessing climate-related risks.
(b) on the processes for managing climate-related risks.
(c) on how processes for identifying, assessing, and managing climate-related risks are integrated into the organisation’s overall risk management.
- a description of the climate-related risk, in line with performance reporting expectations. If climate is not a principal risk, this must be explained.
Where climate is a principal risk or the related information is considered material (e.g., climate-related opportunities):
- Metrics and Targets disclosures:
(a) on the metrics used to assess climate-related risks and opportunities in line with its strategy and risk management process.
(c) on the targets used to manage climate-related risks and opportunities and performance against targets.
Phase 3 (2025-26)
Phase 3 expands on the existing reporting requirements for Phase 1 and Phase 2. Where climate is a principal risk, a significant component of another principal risk or the information is otherwise deemed material in-scope reporting entities must include:
- Strategy disclosures:
(a) on the climate-related risks and opportunities identified over the short, medium, and long term.
(b) on the impact of climate-related risks and opportunities on the organisation’s operations, strategy, and financial planning.
(c) on the resilience of the organisation’s strategy, taking into consideration different climate scenarios.
The application guidance for Phase 3 combines all three phases into a single complete document. This follows the consultation on the TCFD-aligned disclosure Exposure Draft for Phase 3 over summer 2024. The responses and the resulting modifications have been summarised on the consultation page.
[1] Each relevant authority sets the requirements for entities in their jurisdiction, including HM Treasury for central government bodies, other national governments for their Arms-Length Bodies (ALBs) in the devolved administrations (Scotland, Wales and Northern Ireland), the Department for Health and Social Care (DHSC) for NHS bodies, and CIPFA-LASAAC for local government.
[2] For central government, this aligns with existing requirements in the Sustainability Reporting Guidance (SRG). No additional mandatory reporting on Scope 3 GHG emissions are being introduced in this application guidance.
[3]The application guidance for Phase 2 was published on 21 March 2024, following a public consultation on the exposure draft.
Updates to this page
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Updated to reflect the 2025 to 2026 Sustainability Reporting Guidance (SRG), including revised requirements on international emissions and Scope 3. General guidance on sustainability reporting concepts, principles and foundations has been moved to a separate appendix, applicable to both TCFD and broader sustainability reporting. The Application Guidance has been streamlined to reflect these changes.
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Marked the Phase 1 and 2 Application Guidance as superseded, instead referencing to the most up-to-date guidance. Added reference to the Best Practice Examples and adjusted page.
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Publication of the final application guidance (for Phase 3) following the consultation on the Exposure Draft over summer 2024.
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Page updated following the launch of the Phase 3 Exposure Draft consultation
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Updates following the consultation on the Exposure Draft for Phase 2, and subsequent approval of the updated Application Guidance.
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The TCFD-aligned disclosure exposure draft for Phase 2 has been issued, with relevant updates to information included and signposted on this page.
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First published.