At Liontrust, we are committed to providing our investors with comprehensive information about our sustainability efforts, including our alignment with the Task Force on Climate-related Financial Disclosures (TCFD).
We believe climate change will be a defining driver of the global economy, society and financial markets in the future, and that investors will be unable to avoid the impacts of this.
What is TCFD?
The TCFD is an international initiative which aims to address climate-related risks and opportunities in financial markets. TCFD's primary goal is to encourage organisations to disclose clear, consistent, and relevant information about climate-related risks and opportunities in their corporate reporting. This disclosure framework helps investors make informed decisions and assess the financial impact of climate-related factors on businesses.
Why Does TCFD Matter?
Climate change presents both risks and opportunities for businesses. By disclosing climate-related information, companies can:
- Mitigate Risks: Identifying and addressing climate risks early can help protect your investments from unexpected financial losses.
- Seize Opportunities: Recognizing climate-related opportunities can help companies stay competitive and capitalize on emerging markets and technologies.
- Enhance Transparency: TCFD promotes transparency and accountability, fostering trust between companies and their investors.
Our Commitment to TCFD
At Liontrust, we understand the importance of TCFD in ensuring the long-term sustainability of our investments. Liontrust supports the goals of the Paris Agreement to limit greenhouse gas emissions and in turn limit global warming to well below 2 degrees Celsius, and preferably to 1.5, compared to pre-industrial levels.
A company’s greenhouse gas emissions are classified into three types or ‘scopes’.
- Scope 1 are direct emissions from company owned and controlled resources.
- Scope 2 are indirect emissions from the generation of purchased energy.
- Scope 3 are all indirect emissions – not included in scope 2 – that occur in the value chain. In Liontrust’s case, Scope 3 includes emissions from companies that we have invested in.
Liontrust is committed to support the goal of net zero greenhouse gas emissions by 2050.
In May 2022, Liontrust joined the Net Zero Asset Managers’ (NZAM) initiative to adopt formally this goal. In line with this, Liontrust made a formal commitment to set near term science-based targets in June 2023 and submitted its targets to the Science Based Targets initiative (SBTi) for validation in August 2023. In December 2023, Liontrust’s targets were approved by the SBTi. More information on the SBTi can be found here.
Our TCFD Reports
Liontrust has been reporting against TCFD on a voluntary basis since 2018, with historic reporting available in the Liontrust Asset Management Plc annual report and accounts. For calendar years starting from 1 January 2021, the FCA has required listed firms to produce TCFD disclosures, which Liontrust has aligned with since its 2022 annual report and accounts.
The FCA also require certain regulated firms, including asset managers such as Liontrust, to disclose how their products are exposed to climate-related risks and opportunities and how these are being managed and monitored by the firm.
These disclosures take the form of both entity reports, which set out how we take climate-related risks and opportunities into account in managing investments on behalf of our clients; as well as product-level reports, which provide detail on the climate-related impacts of Liontrust’s individual products, to support investors in making informed decisions.
TCFD disclosures are made on an annual basis and will be available on Liontrust’s website by 30th June each year with reports covering the previous calendar year. Our first entity and product-level reports were published on 30th June 2024.
You can access our TCFD product reports in the table below.
The Liontrust Fund Partners LLP TCFD reporting can be found in the Group’s TCFD report.
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