TSRS 2 requires disclosure of information about an entity's climate-related transition plan, including assumptions, dependencies and how it will be financed. Consistency with capital expenditure and financial forecasts is the key sign of credibility.
Source: TSRS 2, ISSB
Related terms
TSRS 2The standard setting out the disclosure requirements for climate-related risks and opportunities.Net zeroAn organisation reducing its greenhouse gas emissions in line with science-based targets and balancing residual emissions with permanent carbon removals so that its net contribution to the atmosphere is zero.Climate-related risksThe potential effects on a company's financial position of physical risks arising from climate change and transition risks arising from the shift to a low-carbon economy.Carbon Border Adjustment Mechanism (CBAM)An EU regulation that puts a price on the embedded carbon emissions in the production of certain goods imported into the European Union.Carbon footprintThe total greenhouse gas emissions caused by an organisation, product or activity, expressed in carbon dioxide equivalent (tCO₂e).Double materialityAssessing sustainability matters both in terms of their effect on the company's financial position (financial materiality) and the company's impact on the environment and society (impact materiality).
Last updated: October 31, 2026 · This definition is for general information only.