Conceptual perspectives on climate risk disclosures for businesses and public sector

Abstract The disclosure of climate-related risks is central to the approach to addressing the vulnerability of the financial system to both physical and transition risks. The public disclosure is a crucial aspect of this, as climate risks are systemic and interconnected, particularly from the perspective of global and national financial institutions. A cornerstone of the current approach is advocating for climate risk disclosure by companies, through the Task Force on Climate-Related Financial Disclosures (TCFD). This paper argues that such an atomized regime is insufficient for addressing systemic risks or serving the broader public interest, as the TCFD framework primarily emphasizes private benefits. Using a conceptual and literature-based methodology, this study critically examines existing disclosure approaches and highlights their limitations in capturing systemic interdependencies and long-term vulnerabilities. In response, we propose a conceptual framework for climate risk disclosures that centers on public sector engagement, governance alignment, and public good considerations. Our analysis suggests that integrating public sector disclosures is essential to bridge current gaps, enhance systemic resilience, and support a more inclusive and comprehensive response to climate-related financial risks.