The Task Force on Climate-related Financial Disclosures (TCFD) framework is frequently described as a narrative framework, four pillars (governance, strategy, risk management, and metrics and targets) that tell the story of how climate risk affects a company. That framing is accurate but incomplete. Behind every narrative element in a TCFD report sits a data requirement: emissions figures at a specific scope and disaggregation, scenario analysis inputs, and targets expressed against a quantitative baseline. Getting the narrative right without the underlying data is cosmetic disclosure. Getting the data right without understanding where it feeds into the TCFD structure means generating numbers that do not answer the questions a disclosure reader is asking.
This article focuses specifically on the data requirements that fall on the sustainability and finance teams: what emissions-related information TCFD expects, in what form, and why the structure matters for defensible reporting.
Pillar 1: Governance Does Not Require Emissions Data Directly
The governance pillar asks who in the organisation oversees climate risk and how that oversight is structured. Board-level committees, management reporting lines, and decision-making authority are the content here, not GHG figures. However, governance disclosure typically references the metrics that management monitors. If the board oversight section states that the board reviews quarterly emissions performance against targets, the report needs to be able to produce those quarterly emissions figures. This is where governance and metrics intersect: governance describes a process that only makes sense if the underlying data exists.
The practical data implication for governance disclosure is that emissions figures need to be available at a cadence and disaggregation level that matches whatever monitoring process is described. Claiming quarterly board review while producing annual numbers that are not disaggregated by business unit creates a credibility gap that reviewers notice.
Pillar 2: Strategy and Scenario Analysis
The strategy pillar is where the climate risk narrative lives: physical risks (extreme weather, supply chain disruption from climate events) and transition risks (carbon pricing, regulatory change, technology shifts, market demand changes). TCFD asks companies to describe how climate scenarios could affect the business over short, medium, and long-term horizons.
The data underpinning strategy disclosure is not primarily historical emissions. It is the intersection of the company's emissions profile with the financial exposure that would follow from each scenario. To describe transition risk from carbon pricing under a 1.5-degree scenario, a company needs to know its Scope 1 and 2 emissions by source type and jurisdiction, because carbon pricing scenarios apply at the jurisdiction level with different price trajectories. A Scope 1 natural gas combustion figure at a Singapore facility is subject to Singapore's carbon tax trajectory. A Scope 1 diesel figure at a Malaysian facility is subject to a different policy environment.
This means strategy disclosure requires the same disaggregated emissions data that feeds a good GHG Protocol report: facility-level, source-type-level, and period-by-period. Without that structure, scenario analysis becomes a company-total number multiplied by a generic carbon price, which does not produce insight and does not survive scrutiny.
Pillar 3: Risk Management and Exposure Quantification
The risk management pillar asks how climate risks are identified, assessed, and managed. It typically references the same scenario framework used in the strategy pillar. For manufacturers, the risk management section often addresses physical risk to facilities (flood zones, heat stress on equipment, supply chain disruption from extreme weather) and transition risk to the cost structure (input costs for energy-intensive processes under carbon pricing, regulatory compliance costs).
The data that populates risk management disclosure is partly operational (facility locations, production dependencies, energy-intensity ratios) and partly emissions data (the cost exposure from carbon pricing requires a Scope 1 figure at the facility and jurisdiction level that corresponds to taxable emissions under each jurisdiction's rules). Some carbon pricing regimes apply to direct emissions above a certain facility threshold; others apply to all purchases of regulated fuels. Knowing which Scope 1 sources are directly price-exposed requires reading the actual regulatory text for each jurisdiction, not applying a blanket company-level figure.
Pillar 4: Metrics and Targets
This is the pillar with the most direct and specific emissions data requirements. TCFD's recommended metrics include, at minimum:
- Scope 1 GHG emissions, in metric tonnes CO2 equivalent, for the reporting period
- Scope 2 GHG emissions (both market-based and location-based where available), for the reporting period
- Scope 3 GHG emissions, for at least the categories material to the company's operations, for the reporting period
- Internal carbon price (if used in investment decision-making)
- Climate-related targets: base year, current year performance, interim milestones
The base year is where reporting teams consistently underestimate the data requirement. A target expressed as "reduce Scope 1 and 2 emissions 40% by 2030 relative to 2022" requires the 2022 baseline to be calculated using the same methodology, boundary definitions, and factor database as subsequent years. If 2022 data was assembled from a spreadsheet using a different emission factor vintage, the baseline and the current-year figure are not comparable. This is not a technicality: it is the measurement equivalent of measuring your weight on a different scale every year and claiming a downward trend.
TCFD also recommends disclosing the methodology used for Scope 3 calculation, specifically whether the company used spend-based or activity-based approaches for each category. This methodological note needs to be consistent year-over-year or, where a methodology change occurs, accompanied by a restatement of prior periods under the new methodology.
What TCFD Requires from Your Data Infrastructure Before Reporting Season
Working backwards from the pillar-by-pillar requirements, a company preparing for TCFD disclosure needs the following data infrastructure in place before the reporting period closes:
Scope 1 by source type and facility: every combustion source (natural gas, diesel, LPG, process gas) quantified by facility and period. This is the input to both the metrics pillar and the transition risk exposure calculation under the strategy pillar.
Scope 2 by facility, both market-based and location-based: electricity billing data per meter account, grid emission factors for the applicable period and jurisdiction, and certificate documentation if market-based claims are made.
Scope 3 for material categories: at minimum, Category 1 (purchased goods and services) and Category 4 (upstream transportation) are material for most manufacturers. The methodology choice (spend-based or activity-based) must be documented and applied consistently.
A documented base year with methodology notes: the year used as the target baseline, the emission factor versions applied, the boundary definition, and any restatement history since the base year was set.
Target progress: current-year performance against each stated target, expressed as a percentage reduction from the base year, with the intermediate milestone trajectory.
The Convergence with IFRS S2
IFRS S2 Climate-related Disclosures, effective for annual reporting periods beginning on or after 1 January 2024, is built substantially on the TCFD framework. The four pillars map directly: IFRS S2 Section 14-17 (Governance), Section 18-25 (Strategy), Section 26-30 (Risk Management), and Section 31-37 (Metrics and Targets). This means companies already preparing TCFD-aligned disclosure have a significant head start on IFRS S2 compliance, provided their underlying data meets the TCFD requirements described above.
IFRS S2 extends the TCFD metrics requirement in one important respect: it requires disclosure of the financed emissions exposure for companies in the financial sector, and specifies cross-industry metrics that all companies must report, including absolute Scope 1, 2, and 3 emissions. Companies that have been reporting TCFD metrics selectively, by covering some Scope 3 categories and omitting others without clear materiality reasoning, will need to document their materiality assessment more formally under IFRS S2.
What Software Can and Cannot Do for TCFD
Automated emissions accounting can produce the quantitative foundation for TCFD disclosure: disaggregated Scope 1, 2, and 3 figures at the level of granularity the metrics pillar requires, with consistent methodology and documented factor versions. It can also produce the time-series data needed for target tracking against a base year.
What it cannot do is write the narrative. The governance structure, the risk identification methodology, the scenario analysis assumptions, and the strategic response to climate risk are organisation-specific judgments that require input from board members, finance leadership, risk officers, and the sustainability team. No calculation system substitutes for that process. What it can do is ensure that when the narrative references a Scope 1 figure, a reduction percentage, or a carbon price exposure estimate, the underlying calculation is there to support it.