New Delhi, Mar 19 (IANS): Globally there is a gap between the way companies identify climate-related risks and opportunities and how they are preparing to tackle them, said a report by a global task force set up by the G20 on Monday.

A vast majority of companies acknowledge that climate change poses financial risks for their business with 83 per cent of companies recognising the physical risks and 88 per cent identifying policy changes or new regulations as the main risks of transitioning to a low-carbon economy.

The report, "Ready or Not: Are Companies Prepared for the TCFD Recommendations", was released by CDP Worldwide (formerly the Carbon Disclosure Project) and the Climate Disclosure Standards Board (CDSB).

It researched 1,681 companies across 14 countries and 11 sectors disclosing to CDP looks at the four areas of disclosure identified by the Task Force on Climate-related Financial Disclosures (TCFD) -- governance, strategy, risk management and metrics and targets -- and highlights whether companies in specific sectors and countries are best prepared to disclose information under those themes.

Companies in France, Britain and Germany were leading the way in disclosing information across three out of the four thematic areas highlighted by the TCFD.

Companies from China, the healthcare and financial sectors are lagging behind in the four areas of disclosure, though China remains a disclosure market to watch out for in 2018 as new mandatory reporting policies come into force.

More than eight out of 10 companies already disclose the financial impacts from the physical and transition risks of climate change, with companies in South Korea and India having the highest rate.

Almost 92 per cent of companies in India have board oversight, while 14 per cent of companies provide incentives to the board for the management of climate change issues in the organisation.

Also, 92 per cent of Indian companies disclose how they prioritise risks and opportunities they have identified, second only to British companies.

Currently only 20 per cent of Indian companies use carbon pricing but the companies surveyed anticipate using carbon pricing in the next two years, which would mean that 59 per cent of Indian companies maybe be using carbon pricing by 2019.

Globally, there is a clear recognition that regulatory risks - classified by the TCFD as atransition' risks, are material, with 88 per cent of companies identifying them. South Korea (97 per cent), the UK (94 per cent) and India (94 per cent) report regulatory risks the most. Indian companies (including financials) are also the most concerned about physical risks - 92 per cent of them recognise the threat.

For India, 51 companies were covered in the survey, mainly concentrated in the Materials and Consumer Discretionary sectors.

"Overall, we see there is a surface level of preparedness from companies globally to have board level oversight of climate risk and opportunity. Key drivers are investor action, company reputation and consumer reaction to climate risk," CDP's Task Force Engagement Director Jane Stevensen said in a statement.

"What we are not seeing is increased governance translating into climate change mitigation. 2018 is the year when companies need to step up climate action as we approach a tipping point."

Simon Messenger, Climate Disclosure Standards Board Managing Director said: "This analysis shows that the financial implications of climate change are now firmly on companies' doorsteps and should be integrated in company-wide processes."

In 2015, the Financial Stability Board (FSB), chaired by Mark Carney -- at the request of G20 leaders -- launched its TCFD or Task Force.

The Task Force, which is chaired by Michael Bloomberg, published their final recommendations for effective disclosure of climate-related financial risks in June 2017.