Breaking Down the TCFD Framework: What It Means for Philippine Companies in 2025

Learn what the TCFD framework means for Philippine companies in 2025. Discover how TCFD-aligned ESG reporting builds resilience, trust, and investor confidence.

Updated September 2025

The Task Force on Climate-related Financial Disclosures (TCFD) has become the global benchmark for climate-related reporting. With the IFRS S2 standards fully incorporating TCFD recommendations, companies in the Philippines face growing expectations from regulators, investors, and stakeholders to disclose climate-related risks and opportunities in a structured, decision-useful way.

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What Is the TCFD Framework?

The TCFD was established by the Financial Stability Board to improve transparency on climate-related financial risks. Its framework is built on four core pillars:

Governance – How boards and management oversee climate-related issues
Strategy – The impact of climate risks and opportunities on the business model
Risk Management – How risks are identified, assessed, and managed
Metrics and Targets – The KPIs and goals companies use to track climate action and progress toward net zero

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Why TCFD Matters in 2025

For Philippine companies, TCFD is more than a global trend—it’s becoming a regulatory reality. The SEC’s Memorandum Circulars (MC No. 10, s. 2022 and MC No. 4, s. 2024) signaled alignment with international standards, pushing companies to adopt investor-grade disclosures.

Investor pressure – Capital providers demand clarity on climate risks
Regulatory convergence – IFRS S2 now embeds TCFD pillars, making alignment essential
Risk management – From extreme typhoons to energy transition shifts, climate risks materially affect Philippine industries
Market advantage – Companies with credible ESG reporting and climate action strategies gain trust and competitiveness

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TCFD and Philippine Companies: The Challenges

Adopting the TCFD framework is not without hurdles:

Data gaps – Many firms lack systems to track emissions and climate metrics
Scenario planning – Few companies run forward-looking climate scenarios
Governance integration – Climate issues remain siloed in CSR units instead of being embedded in board oversight
Capacity building – Finance, risk, and sustainability teams often lack shared knowledge of ESG frameworks

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Practical Steps for TCFD-Aligned Reporting

Map your current disclosures against the four TCFD pillars
Conduct climate risk assessments tailored to your industry
Integrate ESG oversight into corporate governance at the board level
Adopt scenario analysis to anticipate regulatory and physical climate risks
Set net zero targets and report progress transparently

Turn TCFD compliance into investor trust.
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TCFD in Action: Why It Builds Investor Trust

Investors don’t just want compliance—they want clarity. TCFD-aligned reporting assures them that:

Climate-related risks are understood and actively managed
Strategies are resilient to both physical risks (storms, floods) and transition risks (carbon pricing, renewable energy shifts)
Companies have credible, data-backed pathways to net zero

By adopting TCFD, Philippine companies not only meet disclosure requirements but also signal resilience, foresight, and accountability—all critical to attracting capital in 2025 and beyond.

Turning Climate Disclosure into Business Advantage

The future of ESG reporting in the Philippines lies in climate-focused, investor-grade disclosures. The TCFD framework, now embedded in IFRS S2, provides the roadmap.

Don’t just comply—compete. Transform your climate disclosures into investor trust. Book your ESG consultation with GCSS, Inc. today or reach us at sales@gcssinc.com.

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Companies that move early will reduce risks, attract investment, and lead in sustainability performance.