Handbook for Introducing TCFD in Sustainability Reporting, Case Study: Normet Group Oy

Abstract

This Bachelor’s thesis explores the complex nature of Task Force on Climate-related Financial Disclosures (TCFD) framework. The primary purpose of this project was to deliver a tailored handbook for introducing TCFD to Normet Group Oy. Normet Group Oy is an international mining and tunnelling company headquartered in Espoo, Finland. The firm is proactively seeking to embrace new reporting initiatives, such as TCFD, within its recently adopted Environmental, Social, and Governance (ESG) reporting. The aim was thus to present the key components belonging to the framework and introduce a possible adoption process to Normet Group Oy with recommended steps for each stage.

The thesis consists of a theoretical and an empirical part. First, a review was conducted of the theory and literature regarding the context of sustainability, environmental accounting, TCFD and the mining industry. Second, diverse project methodologies were applied to bridge the gap between theory and practice. The desktop studies and company interviews contributed to creating a Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis on Normet’s readiness for adopting TCFD, while the benchmarking method studied the reporting practices employed by external companies. The interviews carried out with sustainability consultants aimed to obtain practical views of practicing TCFD reporting.

The results of the SWOT analysis highlighted Normet’s practices aligning with TCFD recommendations and identified the areas needing further attention. Notably, the benchmarking demonstrated that if the TCFD framework is not standardized, each companies’ disclosures may vary in quality and details. This was also addressed during the interviews, where the interviewees enhanced for instance the role of the new Corporate Social Responsibility Directive (CSRD) in improving and standardizing TCFD practices.

Collectively, the gathered information set the foundation for a roadmap, which outlined potential steps Normet could follow to initiate the TCFD process and complete its disclosures according to TCFD recommendations. Normet Group Oy is provided with insights into emerging trends and other recommendations for enriching their sustainability reports in the future. The results of the handbook serve as a visual guide introducing TCFD along with actionable steps for getting started.