Legal & Regulatory News

OECD publish guidance on the ensuring credibility of corporate transition plans

On 3 October 2022, the OECD published guidance entitled "Transition Finance: Ensuring Credibility of Corporate Climate Transition Plans," (the Guide) to aid corporate transition planning, with a particular emphasis on transition plans for hard-to-abate industries that will be critical in achieving the Paris Agreement goals.

The OECD note the key role that financial institutions and products will pay in any successful transition. The Guide therefore states that transition finance must be grounded in "credible" transition plans.

Th Guide accepts that with the growing pressure on corporates to start their sustainability journey, comes the growing risk of greenwashing allegations. The Guide provides 10 recommendations for corporates looking to create "credible" transition plans, including:-

• setting temperature goals, net-zero and interim targets;
• using sectoral pathways, technology roadmaps, taxonomies;
• measuring performance and progress through metrics and KPIs; and
• supporting a Just Transition.

Click here to view the Guide.

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