Aerial view of harvesting alfalfa crop using tractor

How the agriculture sector adopted climate-related disclosures

The agriculture, food and forest products sector performed the worst of all nonfinancial sectors.

In brief

  • The agriculture, food and forest products sector scores the lowest for coverage and quality of climate-related disclosures of all the nonfinancial sectors.
  • Significant differences exist in the quality and coverage of disclosures across regions, with companies from the least regulated markets scoring the lowest. 

Analysis of the 2019 EY Global Climate Risk Disclosure Barometer revealed that surprisingly the agriculture, food and forest products sector scored the lowest for coverage and quality of climate-related risk disclosures across all the non-financial sectors. However, except for a few poor performers (including companies from Russia, Kazakhstan, China mainland, South Korea and the Philippines), most companies disclosed some level of information required in the recommendations. Each of the companies from the sector that were reviewed received a score for both the coverage and quality metrics on the basis of how they addressed or implemented all of the 11 recommendations by the Task Force on Climate-related Financial Disclosures (TCFD).

Overall, the sector showed significant discrepancies across regions — almost a quarter of companies within one market scored on average 10% less for quality, while another quarter of companies obtained over 40%. Companies in the US, France and Japan were some of the top performers, while Brazil and the UK were some of the other markets that ranked as good performers. This is likely because of the global exposure of these companies’ operations and supply chains (which were headquartered in these markets) to transition and physical risks. Also combined with it was the growing consumers’ expectation for greater transparency and traceability for the sector in these markets. Companies from markets with the least regulation scored the lowest for both quality and coverage, and this included Argentina, China mainland, India, Kazakhstan, Russia, Saudi Arabia and Taiwan.

We examined how the agriculture, food and forest products sector performed against the four areas, through which the TCFD recommendations are structured. 


Over one-third of the assessed companies provided some level of information regarding their board’s overall responsibility for climate-related issues and the governance structure in charge of climate-related topics. However, the information often lacked details, which resulted in a low quality score.

Most companies assessed did provide some information regarding their governance apparatus for sustainability issues, but did not provide specific disclosures on the climate-related topics. These companies only made a brief mention in their disclosures that their “sustainability” structure was also responsible of managing climate-related issues.

The good performers described the different governance structures involved in detail in the management and oversight of climate-related topics (e.g., listing the name and position of the members of the climate committee or other climate governance structure), as well as the interactions between these structures. One company also outlined the roles and structure of climate governance at both the company and asset level. 


Over half of the assessed companies listed climate-related risks in their disclosures. A quarter of these companies also provided a detailed description of each of these risks as well as their climate opportunities, indicating the time horizon for each risk and opportunity. Most of this information was provided to Carbon Disclosure Project (CDP) during its annual reporting process.

The other companies did not provide any description regarding the climate-related risks they are exposed to, their climate-related opportunities or their materiality process. This resulted in them scoring “zero” for all three TCFD recommendations. Most of these companies did not respond to the CDP questionnaire.

Companies who responded to the CDP questionnaire tended to provide information aligned with the TCFD recommendations on strategy. This information included detailed descriptions of both transition and physical risks, climate-related opportunities, and their materiality process.

Only three companies in the sector published detailed information regarding climate-related scenarios — on the basis of the Intergovernmental Panel on Climate Change (IPCC) scenarios, the International Energy Agency (IEA) scenario or on their market’s nationally determined contributions (NDCs). Two of these three companies included general comments in their disclosures regarding the company’s resilience in these different scenarios.

Risk management

Forty percent of the companies included some level of information regarding the climate-related risk identification and management process. The most detailed descriptions were, once again, provided in the CDP responses. In these responses, they described the risk identification and management process at both company and asset level, the department or committee of other governance structure (or structures) in charge of risk identification, and also the frequency with which risk identification was performed — which was usually annually.

Most companies failed to provide detailed information regarding the integration of climate risk management into the company’s overall risk management process. While many companies did mention that the management of climate risk was integrated into the company’s overall strategy, no additional information was provided.

Disclosures for the highest performers included:

  • A detailed materiality process used to prioritize the identified climate-related risks, including the business stakeholder value, potential impact and likelihood of occurrence.
  • A report to the board on the identified climate-related risks.
  • A description of the divisions, committees or working groups charged with climate-related risk management at both the asset and company level.

Targets and metrics

The recommendations on targets and metrics were the most commonly adopted of the four TCFD pillars in this sector. Sixty-five percent of the assessed companies disclosed at least some quantitative indicators, such as total greenhouse gas (GHG) emissions or energy consumption. Over one-third of the assessed companies disclosed an increased number of climate-related KPIs, which typically included information on water consumption, waste production and energy consumption — in addition to GHG emissions.

Over half of the companies reported on targets set for their GHG emissions, indicating a target year and a baseline. However, only 22% of the companies also reported targets for other indicators, such as their energy efficiency, energy consumption or water consumption. Also, Scope 1 and 2 emissions were often displayed in the companies’ disclosures, but only a few reported their Scope 3 emissions with clear boundaries and methodology.

In addition to disclosing climate-related metrics and targets on GHG emissions, energy consumption and water use, a few top performers of the sector implemented an internal carbon price and started to use financial incentives to achieve their climate-related targets.

One company stood out as the top performer in the sector in terms of targets and metrics. The company clearly linked GHG emissions targets to their own 2°C scenario and provided a description of the action plans in place to achieve these. To fully integrate its carbon targets into the company’s overall strategy, it also included climate change as one of the components of the CEO’s variable compensation


The agriculture, food and forest products sector surprisingly scored the lowest for coverage and quality of climate-related risk disclosures among all of the nonfinancial sectors. This is despite most companies disclosing some level of information required in the recommendations. This article draws on analysis from the 2019 EY Global Climate Risk Disclosure Barometer and provides a snapshot of the agriculture, food and forest products sector’s uptake of the recommendations by the Task Force on Climate-related Financial Disclosures (TCFD).

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