The Financial Conduct Authority (FCA) has published two consultations looking at climate-related financial disclosure rules for pension providers, asset managers and life insurers.

The proposed disclosure rules are aligned with the recommendations from the Financial Stability Board’s international Taskforce on Climate-related Financial Disclosures (TCFD) for listed and regulated companies.

The rules will require firms to issue disclosures at both firm and product level.

Firms would be required to report annually on how they look at climate-related risks and opportunities when managing or administering investments. These would have to be published on the firm’s main website.

Providers would also have to report annually on individual products or portfolio management services they offer. The reports would include a core set of metric on carbon emissions.

The proposal aims to ensure the right information on climate-related risks is available at all points along the investment chain.

Sheldon Mills, executive director of consumer and competition at the FCA, said it is vital that financial services play a leading role in addressing climate change.

He said that current climate-related disclosures do “not yet meet investors’ and market participants’ needs” but the new rules should “help markets, investors and ultimately consumers better understand the impact of climate change and make more informed decisions.”

The FCA expects most asset management firms to fall into the remit of the new rules.

The regulator’s consultations propose a phased approach, with the largest asset management firms with over £50bn in assets under management coming under the rules from January 2022 with the first reports to be published by 30 June 2023.

The remainder of firms would see the rules come into force from January 2023, with their first reports to be published by 30 June 2024.

The proposed rules would not apply to defined benefit schemes as the regulator said they fall within the scope of Department for Work and Pensions (DWP) regulations around climate change.

The DWP earlier this week proposed draft regulations to come into force in October which will require large occupational pension schemes and master trusts to report in line with the TCFD’s recommendations.