Adoption depends on a number of factors such as how relevant companies think these disclosures are to investors, how difficult it will be for companies to adhere to these recommendations, and what the real and perceived legal liabilities are for including this information in financial filings.

We explored how difficult it will be for companies to implement the TCFD’s recommendations by examining the disclosures of 15 of the largest oil & gas companies that had filed a U.S Securities and Exchange Commission (SEC) Form 10-K or Form 20-F in 2016^Footnote2 and their sustainability reports.^Footnote3 Our reasoning was that if companies were already doing a reasonable amount of disclosure before the TCFD recommendations were published, then it would be more feasible to implement those recommendations than if virtually no related disclosures were being made.

In general, we found reporting for 2016 uneven, with some TCFD categories fairly well covered and others not. We also found variation across companies, with most making fairly modest disclosures but some being fairly progressive in this regard. The fact that even a few companies are coming close to these recommendations, even before they were published, is evidence that it is not an impossible or overly burdensome task to do so.