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Evaluating TCFD Reporting: A New Application of Zero-Shot Analysis to Climate-Related Financial Disclosures

2023-02-01 · Alix Auzepy, Elena Tönjes, David Lenz, Christoph Funk

We examine climate-related disclosures in a large sample of reports published by banks that officially endorsed the recommendations of the Task Force for Climate-related Financial Disclosures (TCFD). In doing so, we introduce a new application of the zero-shot text classification. By developing a set of fine-grained TCFD labels, we show that zero-shot analysis is a useful tool for classifying climate-related disclosures without further model training. Overall, our findings indicate that corporate climate-related disclosures grew dynamically after the launch of the TCFD recommendations. However, there are marked differences in the extent of reporting by recommended disclosure topic, suggesting that some recommendations have not yet been fully met. Our findings yield important conclusions for the design of climate-related disclosure frameworks.

📄 PDF Abstract BibTeX arXiv:2302.00326

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text-classificationText ClassificationZero-Shot Text Classification

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