On Wednesday 17 March UK Finance hosted the first of a four-part COP 26 and Beyond webinar series in collaboration with EY. This first webinar, with over 500 delegates, focused on board responsibilities and reporting considerations on climate change. We were joined by our speakers HSBC's Daniel Klier, United Trust Bank's Jonathan Ayres, and Khadija Ali, Shaun Carazzo and Mark Watson from EY who covered a wide range of topics.

It's been over five years since Mark Carney's pivotal ?Breaking the Tragedy of the Horizon? speech. Much has happened since then, including a growing surge of regulatory activity globally. As we look forward to COP26 in November, it is important that  boards of directors step up and lean in.

The ten key messages in the webcast were:

1. Distinguish between environmental, social and corporate governance (ESG) and climate change: Boards need to drive strategies on broad ESG matters, as well on the firm's net zero strategy. These are highly connected but need to be considered distinctly. Blurring the two can lead to muddy thinking.
2. Boards should set the tone: Climate change is strategically important, so it should be interwoven with the firm's purpose and long-term value creation strategy. Boards need to insist that this connection is real and communicated as such across the organisation.
3. It is important to set out a firm's strategic stance: Internal and external stakeholders want to know how the firm is approaching climate change. What are the aspirations or commitment to net zero? What is executive management doing to incent and support customers? and clients? transition to a net zero economy? How will it make the tough calls on which clients to support and which to edge away from?
4. Take a balanced view on risks and opportunities: Firms may potentially view climate change too much as a risk or an opportunity. It's clearly both. Financing needs in order to reach net zero are significant, but so too are the physical and transition risks that need to be well managed and appropriately priced.
5. Governance matters: Boards need to determine how they will oversee the many aspects of climate change (including across their committees) and management teams need an operating model that links together many aspects of the firm.
6. Weave climate risk into the fabric of risk management: Financial services firms have established sophisticated enterprise risk management (ERM) frameworks over the past decade, so they should leverage them to embed climate risk - physical and transition - into the risk management cycle, to identify, measure, manage and mitigate the risks.
7. Embed climate risk across the organisation: Firms can't simply embed climate risk into ERM. It needs to be deeply embedded into a broad set of management processes, including business planning, product design, underwriting and pricing, credit decisioning, human resources, compliance, capital, liquidity and balance-sheet management, portfolio analysis, reporting and disclosure, and so on.
8. Data is important but can't be an excuse for inaction: Everyone acknowledges data - and management information systems - are important to properly manage climate risk, and available data has significant limitations. But data limitations should not stall board and management dialogue on strategy, scenarios and action. The data doesn't need to be perfect; it needs to be good enough.
9. Develop a compelling strategy-first narrative and deliver it effectively across channels: Firms need to develop their overarching climate change narrative - what are they seeking to achieve, how does it link to purpose and strategy, and how will they get to achieve their objectives. They then need to determine which communication channels and disclosure frameworks they will use to disseminate their objectives and journey to a broad range of internal and external stakeholders. Communications need to be clear, consistent and comprehensive - so they also need to be well controlled.
10. Educate, educate, educate: Climate change - and even more so, ESG - is a complex issue, with many new concepts and its own language and terms. Training and upskilling are essential -  from board members to specialist staff to the employees at large. Only then will there be a common language across the organisation and informed dialogue and decisions.

The playback can be accessed by registering here and you can register for our 21 April session on Climate Risk Management and Stress here.

View the rest of the sessions below:

• Climate Risk Management & Stress Testing, 21 April
• Latest Developments in TCFD Reporting, 19 May
• Transition to Net Zero, 23 June