As the 2025 deadline for mandatory climate reporting approaches, Swiss companies are undertaking efforts to align with regulatory standards. Enfinit's pioneering study in 2023 highlighted substantial gaps, particularly in how companies disclosed potential impacts of climate-related risks on company strategy and financial performance (also known as 'financial materiality'). In October 2024, Enfinit published the follow-up report which benchmarks the first study and tracks progress as Swiss companies prepare for compliance.
The 2024 study examines climate reporting practices of 50 non-financial publicly listed Swiss companies and assesses the extent of their alignment with TCFD recommendations across four pillars: Governance, Strategy, Risk Management, and Metrics & Targets. The results demonstrate a minor year-on-year improvement in reporting on climate-related topics across all four pillars. Predictably, Swiss companies are taking action to prepare for the upcoming mandatory reporting requirements under the Ordinance on Climate Disclosures. However, such improvements are concentrated primarily in the "low-hanging fruit" areas like describing Governance and Risk Management practices, and further considerable progress is needed to become aligned with the TCFD recommendations.
Governance-related disclosures show the closest alignment with TCFD recommendations, with around two-thirds of companies detailing how sustainability is managed. However, while in most cases board oversight on sustainability matters is disclosed in detail, climate-specific topics within the sustainability umbrella are not always mentioned or sufficiently described.
Although executive management’s involvement is typically described, the relevant roles and responsibilities of different business functions within the company are not always well articulated. Mapping roles and responsibilities is crucial for identifying functional teams tasked with implementing climate-related action plans.
Strategy remains the weakest pillar, with fewer than 30% of companies disclosing relevant information. Although many disclosures reference materiality assessments, they often lack context about why climate-related issues are material for the company and the environment. Resilience remains a widely under-disclosed topic with less than 20% of the companies reporting on how their strategy is resilient to climate-related risks. This finding is especially relevant given that only 8 companies (out of 50) disclosed that they have undertaken a Scenario Analysis, which is the key tool, per TCFD framework, for assessing the resilience of company strategy to climate-related risks.
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There is a considerable year-on-year improvement in disclosures related to Risk Management across various areas, but some key areas are still lagging. Half of the companies now disclose how they identify, prioritize, and manage climate-related risks - an improvement from 37% in 2023. The clear areas of progress since last year are evident in how companies consider existing and emerging regulatory requirements as well as integration of climate-related risks into the overall risk management framework. However, several key areas are still lagging, notably disclosures related to how climate-related risks are managed. Additionally, disclosures of the most material physical and transition risks and opportunities remain insufficient.
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Findings related to disclosures on Metrics and Targets reveal a persistent disparity between Environmental and Financial materiality. Metrics and targets related to GHG emissions continue to show strong alignment, similar to last year. Additionally, most of the companies fare well in terms of disclosures for other environment-related metrics and targets such as those pertaining to energy, waste and water. However, there is generally a gap and misalignment in metrics and targets that pertain to financial materiality. The study shows that only 3 out of the 50 companies presented metrics related to physical and transition risks. Similarly, only 5 companies disclosed metrics related to the proportion of revenues and assets aligned with climate-related opportunities.
Most transition plans focus on GHG reduction targets but lack detailed descriptions of the actions needed to achieve them. Enfinit’s 2024 study shows that out of the 50 companies assessed, only 10, or 20%, include elements of a climate transition plan in their sustainability reports. In most cases, companies primarily include GHG targets accompanied by a summary of various relevant activities and initiatives.
Overall, reports tend to lack a unified roadmap that consolidates all relevant information into a dedicated section. Details on targets and activities are often scattered across the reports, making it difficult to gain a comprehensive understanding of various elements related to the transition plans. While many companies mention efforts like fleet electrification, industrial efficiency improvements, use of renewable energy, and value chain-wide GHG reductions, they do not clearly explain or quantify how these initiatives will help meet their targets. This lack of clarity makes it difficult to fully understand how the goals will be achieved. The figure below presents an illustrative example of how companies can visually present the various levers that can contribute to reaching the set targets. Each lever can be further defined and explained. This can provide clear visibility to stakeholders on how the transition is planned for each company.
Example of levers to reach near-term targets (tons CO2)
As expected, companies with higher revenues show stronger alignment across all four TCFD categories. Similar to the findings from 2023, the latest Enfinit report shows that companies generating annual revenues exceeding CHF 10 billion are the most aligned with TCFD recommendations. However, even these sizable companies fall short of full alignment with TCFD recommendations. Key gaps remain in areas such as physical and transition risks, financial impact disclosures, and detailed transition plans.
Download the full report for a detailed analysis and best practices.
In addition to climate reporting, the study includes dedicated contributions from several partners:
- Legal insights on climate reporting from Walder Wyss
- Focused assessment of how TOP100 Swiss companies disclose nature-related impacts - contribution by engageability
- A deep dive on how Swiss companies are handling physical climate risk disclosures - contribution by CLIMADA Technologies
- A review of first-wave reports in accordance with the CO 964 a-c - contribution by Enterprise for Society Center (E4S)
- Insights on carbon markets form Ecosecurities
- Insights on reporting innovations by MDD and Pelt8
About Enfinit
Enfinit is a Geneva-based advisory firm specializing in energy and sustainability. The firm supports companies in identifying and quantifying climate-related risks associated with the transition to a low-carbon economy. Enfinit also helps businesses develop concrete mitigation strategies and actionable plans to achieve their sustainability goals.
Contact
Enfinit Sàrl
Qendresa Rugova
Managing Director
qrugova@enfinit.ch
Rue de la Faïencerie 2
Geneva, 1227 Carouge
www.enfinit.ch