Consultation on amending Ordinance on Climate Disclosures in Switzerland

We refer to the Swiss Federal Council’s consultation on its amendment of the Ordinance on Climate Disclosures.[1] We appreciate the opportunity to contribute our investor perspective to the future Swiss climate disclosure regime.

Norges Bank Investment Management (NBIM) is the investment management division of the Norwegian central bank and is responsible for investing the Norwegian Government Pension Fund Global. NBIM is a globally diversified investment manager with CHF 43.96 billion invested in Switzerland as of year-end 2024, of which CHF 36.4 billion is invested in 111 Swiss companies.

As a long-term investor, our returns depend on sustainable economic, environmental and social development, as well as on well-functioning, legitimate and efficient markets. As an active investor in over 65 countries, we require reliable, consistent and comparable sustainability-related financial information across global markets. We strongly support the IFRS Sustainability Disclosure Standards (ISSB standards) as the global baseline for sustainability-related financial disclosures. The ISSB standards build on the recommendations of the Task Force on Climate-Related Financial Disclosures Recommendations (TCFD), which are required by the current text of the Swiss Ordinance on Climate Disclosure. The ISSB standards also share the same conceptual foundations as the International Accounting Standards Board (IASB) financial reporting standards. They enable investors to receive sustainability-related financial information that is concurrent, connected and complementary to financial statements. This is critical for our holistic assessment of companies and informs our investment decisions, risk management and ownership activities.

Given our global disclosure needs, we strongly welcome the Swiss Federal Council's proposal to recognize internationally accepted standards for climate reporting. However, we recommend that Article 3(1) of the Ordinance of Climate Disclosures[2] should explicitly reference ISSB S2 as the required standard, rather than the current reference to "an internationally recognized standard". The current wording seems to allow companies to choose between an internationally recognized standard or the sustainability reporting standard used in the European Union. This could create uncertainty for both companies and investors. Moving from a reference to the Task Force on Climate-related Financial Disclosures (TCFD) to a non-specified ‘international standard’ might lead to inconsistent reporting practices, with preparers choosing between various frameworks and standards. By explicitly requiring ISSB S2, the Federal Council would provide greater certainty. This would reduce the reporting burden for multinational companies, and ensure investors receive consistent, comparable, and decision-useful climate-related information.

We further welcome the Swiss Federal Council's reference to the Transition Plan Taskforce (TPT) framework in the explanatory report to the proposal. While other frameworks and industry initiatives can provide complementary insights, we have supported the IFRS Foundation's assumption of responsibility for TPT's disclosure materials as the global reference. These materials will be used to develop specific guidance, ensuring compatibility with ISSB S2's investor-focused climate disclosure requirements. The Swiss Federal Council’s adoption of the TPT materials and forthcoming ISSB guidance will best support global consistency in transition planning.

The proposal's clear minimum standards for companies to adopt net-zero roadmaps (formerly "transition plans") are particularly noteworthy. This aligns with our Climate Action Plan 2025.[3] We expect portfolio companies to establish net-zero 2050 targets including short, medium, and long-term milestones for scope 1, 2 and material scope 3 emissions. However, we encourage the Swiss Federal Council to extend the requirement for climate risk scenario disclosures beyond the companies in the financial sector. We expect this disclosure from companies in both financial and non-financial sectors. It provides critical insights into how companies assess and prepare for climate-related transition and physical risk. In addition, we value disclosure of the underlying assumptions about scenario choice, asset coverage and emission trajectories. Furthermore, we expect companies' transition plans to include information on governance structures, capital allocation frameworks, carbon price assumptions, and the quality and use of any carbon offsets.

Regarding reporting frequency, we note that the explanatory report to the proposal only requires companies to update net-zero roadmaps when significant changes occur, rather than on a consistent periodic basis. In line with our Climate Action Plan, we expect companies to provide annual updates on transition plans, including externally verified emissions data across scopes (1, 2, and 3) and progress.[4] These disclosures provide the decision-useful information that we need to assess and monitor our portfolio companies’ progress towards net-zero.

We support Switzerland’s plans to expand the scope of companies subject to mandatory climate reporting through the revision of the Code of Obligations. When implemented, this will extend the scope of the Ordinance on Climate Disclosures. We welcome this planned expansion and the consideration of proportionality measures for smaller companies. This balanced approach would enable companies to develop robust reporting capabilities while enhancing decision-useful disclosures for investors.

We appreciate your consideration of our perspective and remain at your disposal should you wish to discuss these matters further.

Yours sincerely

Carine Smith Ihenacho,
Chief Governance and Compliance Officer                                     

Dr Shilpi Nanda,
Policy Advisor

[1] The Ordinance of 23 November 2022 on Reporting on Climate Matters.

[2] Article 3 Reporting on Climate Matters Based on International Standards (Art. 964b (1) and (2) CO).

[3] See our climate action plan, which can be accessed here: 2025 Climate action plan | Norges Bank Investment Management. Also see our climate change expectations of portfolio companies, which can be accessed here: Climate change.

[4] Ibid.