This report explores global reporting practices on fossil fuel reserves and the nature of any information gaps. It asks two questions: (1) To what extent do existing reporting standards governing company disclosures to financial markets require or enable the provision of useful information on fossil fuel reserves?, and (2) What steps are necessary to integrate emerging and future climate change risks into disclosures?

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This report focuses on the disclosure of information related to fossil fuel reserves and the information required by investors to help them understand the financial viability of those reserves in a carbon-constrained world. It does not discuss physical climate change risks associated with fossil fuel reserves. Financial reporting standards, industry reporting standards and stock exchange listing requirements were analysed in seven countries: Australia, Canada, China, the UK, Russia, South Africa and the US. Disclosures about fossil fuel reserves in the annual reports and accounts, made by 35 extractive industry companies, were also analysed.

In making their recommendations, the authors recognise that each part of the reporting community has its own due process and operating mandates that need to be taken into account and respected. The key aim is to encourage the provision to financial markets of value-relevant information and the growth of climate literacy, not only among investors but also among accountants in all their many business and professional roles, as well as among other institutions working to support financial market stability.

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Article Details

Date: 1 Oct 2013

Region: Global

Topic: Sustainability; Carbon; Climate change; Sustainability reporting; Environment reporting