The process of climate-related scenario analysis may seem intimidating to many companies, but it may not be as abstract a concept as one would imagine. To most companies, it may only be a natural step to extend existing risk management procedures to climate-related issues. By doing so, companies would very likely find assessing climate-related risks to be as critical as financial risks and warrant as much attention in their regular business planning and risk management processes.
This publication builds on the introduction to climate reporting that is set out in the ISCA Climate Disclosure Guide – Taking First Steps Towards Climate-related Disclosures and takes inspiration from the TCFD Guidance on Scenario Analysis for Non-Financial Companies and other experiences and sources to delve into the topic of climate-related scenario analysis, which is a useful tool to develop an understanding of how climate-related risks may affect the company’s businesses, strategies, and financial performance over time.
It first provides an overview of climate-related scenario analysis before describing an overview approach to perform the process. Guidance on how to get started is provided, along with the sharing of learning experiences and insights and other resources. Lastly, common climate-related risks in Singapore’s context are shared for consideration.
The guide was developed with the support of Singapore Exchange Regulation, Green Finance Industry Taskforce, ISCA’s Sustainability and Climate Change Committee (SCCC) and SCCC Sustainability Excellence Sub-Committee.
Please click here to download the ISCA Climate Disclosure Guide Volume 2 – First steps in conducting climate-related scenario analysis.