Contemporary forms of “marketized” sustainable finance rely on the production, dissemination, and consumption of financialized ESG risk information. In this paper, we scrutinize this “risk transparency premise” in context of the TCFD's climate risk reporting framework. Adopting the lens of institutional theory and a mixed methods approach, we pursue two interrelated aims. First, we examine to which extent the climate risk disclosures of TCFD “supporters” from the European financial sector adhere to the information requirements spelled out in the TCFD framework. Second, we seek to uncover the organization level impediments that underlie substantive implementation of the TCFD framework and, in turn, the production and dissemination of the required climate risk information. Based on our findings, we argue that TCFD/climate risk reporting is prone to become a ‘ceremonial’ practice and that, at least as of now, the ‘institutional myth’ of risk transparency might rather serve to safeguard the ideals of the market as opposed to facilitate transformative change towards a more environmentally sustainable economy. Our findings complement research that has problematized contemporary forms of marketized sustainable finance as well as literature on climate risk reporting and TCFD more specifically.
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