In 2015, the TCFD was established to develop a reporting framework of comparable and consistent disclosures for organisations to use to demonstrate climate change resilience. Just two years later, in 2017, the TCFD released its recommendations. In the years that have followed, the recommendations have become the foundation for many national and international climate-related disclosure requirements. As a result of the TCFD’s global success, the taskforce was disbanded in October 2023.
NILGOSC became an official TCFD supporter in June 2020, issuing its inaugural climate-related disclosures report the following year. Disclosures are organised around the TCFD’s four thematic areas, representing the core elements of how organisations operate: governance; strategy; risk management; and metrics and targets. NILGOSC continues to support the recommendations, and although regulations applicable to local government pension schemes have yet to be made; NILGOSC has used its fifth year of voluntary reporting to further develop its capabilities, while also highlighting areas to focus on in subsequent reporting periods. NILGOSC’s most recent report is available to review at NILGOSC Climate-related Disclosures Report 2025.
In 2023, NILGOSC secured the long-term provision of TCFD-aligned carbon analytics from its global custodian, Northern Trust. Working alongside Northern Trust’s specialist team, it was possible to analyse 49% of the Fund’s holdings at 31 March 2025 year end. The portion of the fund that could be measured (primarily composed of NILGOSC’s active and passive equity holdings) outperformed the benchmark comparator (the MSCI World Index): emitting 63% less Scope 1 and 2 carbon dioxide equivalents on an absolute emissions level; and reporting a 39% lower Weighted Average Carbon Intensity (WACI).
Notwithstanding the positive results, the figures should be caveated to note that: the metrics represent a single point in time, serving as a tool for continuous monitoring; as a diversified asset owner with investments in many asset classes and geographies, much of which could not be included in this year’s analysis, insights will improve as coverage continues to; and reliability of data continues to pose a challenge to all disclosing parties. However, even in just the last few years, the methodologies for calculating Scope 3 emissions in particular, have continued to evolve and improve, driven by increasing regulatory pressures and the development of new standards and frameworks. Therefore, it is expected that reporting capabilities will continue to advance as all parties work towards improving disclosures globally.
Adopting the TCFD recommendations is an iterative process, and full implementation will understandably take multiple reporting periods. NILGOSC continues to work closely with Northern Trust; and looks forward to the continued evolution of climate-related metrics, as well as improvements in data availability and asset coverage over time.
