The UK Transition Plan Taskforce (TPT) has set guidelines for businesses to navigate transition to a low-carbon economy, providing a framework for developing comprehensive and credible net zero plans.

The TPT was active from April 2022 to October 2024 and engaged with more than 600 organisations globally, including financial institutions, corporates, governments, regulators, and civil society.

This inclusive approach helped the development of a comprehensive set of materials to guide transition plan +disclosures. The framework outlines strategies to:

• reduce greenhouse gas emissions

• manage climate-related risks

• identify opportunities for a low-carbon future

• encourage companies to engage with full value chains to identify and address emissions across all scopes. (1)

SaveMoneyCutCarbon advises that the TPT has encouraged companies to take a holistic approach to transition-plan disclosures, with a focus on three priorities: 

1. Decarbonising. Focus on actions in a company’s own operations or value chain that reduce greenhouse gas (GHG) emissions. 

2. Responding to risks and opportunities. Outline actions that build the company’s resilience to physical and transition risks from climate change. 

3. Contributing to an economy-wide transition. Identify levers they can use to accelerate the transition to a low-carbon economy. 

The International Transition Plan Network (ITPN) was launched at COP26 in Glasgow to support development of global norms for transition plans by the private sector and to support state climate policy that makes best use of transition plans. 

The network includes official sector actors with private sector representatives, civil society and academia across jurisdictions. The ITPN is an informal space for dialogue. It will also support the development of new collaborative partnerships.

The UK Transition Plan Taskforce completed its work on October 31, 2024, publishing a final report outlining achievements and prospects. The IFRS Foundation is now responsible for the TPT’s disclosure-specific materials. (2)

The TPT’s work was picked up by the team behind the former Secretariat, it is now working with the ITPN to support the development of global norms for private sector transition plans and their integration into national climate policies. (2)

For companies, the TPT advice for a best-practice transition plan is that it would include: 

1. Foundations. Outline strategic ambition, including ways of responding to and contributing to transition to a low-carbon and climate-resilient economy. Disclosure of anticipated impacts of the transition plan on business models and value chain, as well as key assumptions underpinning the plan. 

2. Implementation strategy.  Describe actions in all operations, products, services, policies, and conditions that aim to achieve strategic ambition. Discuss the implications of these on financial position, performance, and cash flows. 

3. Action plan: Translate long-term targets into granular actions, with a change-management strategy that engages every function throughout a company, while also analysing how a changing climate might affect objectives. Include engagement with external stakeholders with priority given to areas of maximum impact. 

4. Engagement strategy. Demonstrate ways of engagement with the value chain, industry peers, government, public sector, communities, and civil society to that could deliver strategic ambition. 

5. Metrics and targets. Show the metrics and targets being used to drive and monitor progress. 

6. Governance. Detail ways of embedding transition plan in governance structures to achieve strategic objectives.

Strategic guidance

The ITPN aims to build a global community dedicated to advancing climate transition planning, unifying efforts, promoting best practices, and providing strategic guidance and resources to stakeholders worldwide. It’s core values include collaboration, sustainability, integrity, innovation, and inclusivity. (3)

It is actively involved in discussions and initiatives related to transition plans, including those within the G20 Sustainable Finance Working Group (SFWG). The focus is on fostering collaboration between financial institutions, corporations, policymakers, regulators, and civil society to drive meaningful progress towards a sustainable future. (3)

SaveMoneyCutCarbon’s view is that creating and disclosing strategic plans for climate transition is a market practice that is rapidly becoming a norm. The momentum around private sector transition planning creates a clear opportunity to support strategic planning for global transition to low-carbon economies.

Transition plans and planning are being discussed by regulators and supervisors across the globe, working to avoid fragmentation between jurisdictions while aiming to design best-policy approaches to private sector planning.

7 key ways TPT helps businesses

SaveMoneyCutCarbon’s advises that there are 7 key ways that TPT helps businesses.

1. Guiding principles and disclosure recommendations: These help to ensure transition plans are ambitious, actionable, and transparent, covering aspects like target setting, mitigation strategies, and progress monitoring

2. Clear reporting framework: TPT offers a structured set of disclosure recommendations that outline the key elements a company should include in its transition plan, ensuring consistent and comparable information for investors and stakeholders. 

3. Alignment with other frameworks: TPT aligns with other international frameworks such as the Task Force on Climate-related Financial Disclosures (TCFD), promoting consistency in climate reporting and transition planning.

4. Integration with financial reporting: By aligning with IFRS S2, TPT enables companies to seamlessly integrate their climate transition plans into their broader financial reporting, enhancing the credibility and reliability of climate disclosures.

   IFRS S2, issued by the International Sustainability Standards Board (ISSB), sets out requirements for disclosing information about a company’s climate-related risks and opportunities, building on IFRS S1, and is effective for annual reporting periods beginning on or after January 1, 2024. 

5. Strategic planning guidance: The TPT framework encourages companies to develop comprehensive climate transition plans that encompass emissions reduction targets, investment strategies, and potential risks and opportunities related to climate change. 

6. Enhanced transparency and accountability: By publicly disclosing detailed climate transition plans, businesses are held accountable for their progress towards net zero goals, potentially leading to increased stakeholder confidence and market competitiveness. 

7. Supporting informed decision-making: TPT's framework promotes data-driven decision making by requiring companies to assess their climate impacts, identify relevant metrics, and track progress towards their targets. 

The TPT framework encourages companies to disclose emissions across their entire value chain, including direct emissions (Scope 1), indirect emissions from purchased energy (Scope 2), and emissions from their supply chain (Scope 3). 

Companies are expected to identify and analyse the potential financial and operational risks and opportunities associated with climate change. The framework emphasises the importance of robust governance structures to oversee the implementation of climate transition plans. 

The TPT framework is a resource, not a requirement and currently companies are not required to follow it for their transition plan disclosures. However, trends in regulated climate reporting indicate that companies should consider implementing the framework in developing and disclosing transition plans.

The Financial Conduct Authority (FCA) has encouraged listed companies and regulated firms as well as banks to engage with the framework. (4)

By adhering to the TPT framework, companies can demonstrate a commitment to climate action and build trust with investors and stakeholders. This is a sound business strategy.

SaveMoneyCutCarbon’s view is that the TPT framework will play a crucial role in guiding UK businesses towards a low-carbon future by providing a standardised approach to climate disclosure, encouraging proactive climate strategy development, and promoting transparency to stakeholders. 

The framework is viewed as a global gold standard based on common principles and so could help companies in the net zero transition by making planning more efficient, less complicated, and more useful for all stakeholders.

Bibliography

1 “TPT Legacy” (Accessed March 2025) https://itpn.global/tpt-legacy/

2 “Transition Plan Taskforce resources” (Accessed March 2025) https://www.ifrs.org/sustainability/knowledge-hub/transition-plan-taskforce-resources/

3 “Supporting the development of global norms for transition plans” (Accessed March 2025) https://itpn.global/

4 “FCA welcomes the launch of the Transition Plan Taskforce Disclosure Framework” (Accessed March 2025) https://www.fca.org.uk/news/news-stories/fca-welcomes-launch-transition-plan-taskforce-disclosure-framework