If these changes are adopted as proposed, they will present the following practical implications:

1. Compliance with these rules require in-scope firms to make mandatory disclosures, both quantitative and qualitative, on climate-related matters, including risks and opportunities, and certain climate metrics.
2. The FCA requirements may trigger disclosures for the first time. This may require implementation of new reporting processes, and potentially a broader re-evaluation of the firm’s approach to climate risks. For firms that are already complying with TCFD recommendations on a voluntary basis, it will be important to assess whether such voluntary reporting is in compliance with the specific requirements and scope of the FCA rules.

AIMA has categorized this proposal as Medium Priority/Medium Impact and it is therefore represented in mid-dark blue in the AIMA Regulatory Horizon Scan gantt chart.

Phase 1: asset managers which are SMCR Enhanced Firms and which have GBP 50 billion of AuM or more, based on the AuM test set out in SMCR for Enhanced Firms. The deadline for publishing the first reports for firms in this phase was 30 June 2023.

Phase 2: all remaining in-scope asset managers (i..e. those with more than GBP 5 billion, but less than GBP 50 billion AuM).

In collaboration with Simmons and Simmons, we have published a Guide to FCA TCFD Climate Disclosure Rules, which can be found here. AIMA’s global resources related to responsible investment can be accessed here: https://www.aima.org/compass/practical-guides/responsible-investment-esg.html