TCFD Reporting for SMEs: What Suppliers Are Being Asked in 2026
What Is TCFD and Why Are Suppliers Being Asked About It?
TCFD reporting for SMEs is increasingly relevant in 2026 because large companies with mandatory TCFD obligations are cascading climate risk questions into their supply chains. The Task Force on Climate-related Financial Disclosures (TCFD) is a framework developed by the Financial Stability Board that asks companies to disclose how climate change creates risks and opportunities for their business.
TCFD is now mandatory for: - All UK premium-listed companies and large UK businesses (500+ employees, £500M+ turnover) under FRC and FCA rules - All ASX-listed large entities in Australia under AASB S2 - Large EU companies under CSRD (using ESRS E1, which aligns closely with TCFD) - Voluntarily by thousands of global companies ahead of regulatory deadlines
When your large enterprise client has a TCFD obligation, they ask their suppliers: "What climate risks affect your business, and how do they affect the products and services you supply to us?"
The 4 TCFD Pillars: What Suppliers Are Asked
TCFD organises climate disclosure into four pillars. Here is what each means for an SME supplier:
1. Governance — Does your company have board-level oversight of climate risk? For most SMEs, a simple statement that the managing director or CEO is responsible for climate-related decisions is sufficient.
2. Strategy — How does climate change affect your business model? This includes physical risks (flooding, heat stress affecting your premises) and transition risks (carbon pricing, changing customer demand, policy changes).
3. Risk Management — Do you have a process to identify and manage climate risks? For SMEs, a brief risk register that includes climate is usually enough.
4. Metrics and Targets — This is where your emissions data comes in. TCFD asks for Scope 1, 2, and 3 greenhouse gas emissions in tCO2e, and any targets you have set for reduction.
Which TCFD Questions Specifically Require Your Carbon Emissions?
The Metrics and Targets pillar directly requires GHG emissions data. Specifically, TCFD recommends disclosure of:
- Scope 1 GHG emissions (tCO2e)
- Scope 2 GHG emissions (tCO2e)
- Scope 3 GHG emissions (tCO2e) — where material
- Emissions intensity (tCO2e per employee or per £/€/$ million revenue)
- Progress against any emissions reduction targets
This is exactly what a Carbon Passport contains. If your enterprise client is asking for TCFD-aligned data, your DeCarbonOPS Carbon Passport provides the Metrics and Targets section in full.
What Minimum Data Does an SME Need for TCFD Supplier Questionnaires?
Most large companies do not expect their SME suppliers to produce a full TCFD report. What they typically ask for in practice:
| What They Ask | What You Need |
|---|---|
| Scope 1 and 2 emissions | Utility bills converted to tCO2e |
| Scope 3 emissions | Travel, waste, commuting estimates |
| Any reduction target? | A simple percentage or absolute target with a base year |
| Physical climate risks | Brief statement on site flood risk, heat stress, water stress |
| Transition risks | Statement on regulatory risk (carbon pricing) and market risk |
The carbon data section (Scope 1, 2, 3) takes 15–25 minutes with DeCarbonOPS. The qualitative risk sections can be completed with a brief 2–3 sentence statement per risk type.
TCFD vs CSRD vs SECR: Which Framework Applies to You?
As a supplier, you do not need to pick — your clients tell you which framework they use. In practice, the underlying data request is almost identical across all three: Scope 1, 2, and 3 emissions in tCO2e, using GHG Protocol methodology. Generate your Carbon Passport once and use the same figures across all questionnaires.
Frequently Asked Questions
What is TCFD and why are suppliers being asked about it?
TCFD (Task Force on Climate-related Financial Disclosures) is a framework for disclosing how climate change creates financial risks and opportunities. Large companies with mandatory TCFD obligations in the UK, Australia, and EU are cascading climate risk questions into their supply chains — asking suppliers for emissions data and climate risk statements to satisfy their own reporting requirements.
Do SMEs need to publish a full TCFD report?
No. SMEs are almost never required to publish a standalone TCFD report. What enterprise clients ask for is supplier-level data that feeds into their own TCFD Metrics and Targets disclosure — specifically Scope 1, 2, and 3 emissions in tCO2e. A DeCarbonOPS Carbon Passport satisfies the emissions data component of a TCFD supply chain request.
What is the difference between TCFD and CSRD?
TCFD is a voluntary framework (now mandatory in the UK and Australia for large companies) focused on climate risk disclosure from a financial perspective. CSRD is an EU regulation requiring large companies to report on all sustainability topics including climate, using the ESRS standards. CSRD's climate standard (ESRS E1) is closely aligned with TCFD — the underlying emissions data required is almost identical.
Which countries make TCFD reporting mandatory?
TCFD-aligned reporting is mandatory for: large UK companies (FCA/FRC rules from 2022), large ASX-listed Australian entities (AASB S2 from 2025–26), and large EU companies under CSRD (ESRS E1 aligns with TCFD from 2025). New Zealand has also mandated TCFD-aligned reporting for financial sector entities. The US SEC climate disclosure rule aligns with TCFD for listed companies.
What is the minimum data an SME needs to respond to a TCFD supplier request?
The minimum viable TCFD supplier response includes: Scope 1 and 2 emissions (tCO2e), Scope 3 emissions (tCO2e) for material categories, emissions intensity per employee or revenue, a brief statement on physical climate risks to your site (flooding, heat), a brief statement on transition risks (carbon pricing, regulatory change), and any reduction target. The emissions data takes 15–25 minutes using DeCarbonOPS.
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