To date, within the EU, the adoption of a climate transition plan and the setting of greenhouse gas emission reduction targets have largely been a voluntary affair, albeit one aided by a range of public and private sector initiatives to encourage the practice. In 2024, this may change.

Against the backdrop of an increasingly central role for corporate transition planning, our recent booklet discusses the economic and regulatory context of climate transition plans, and their likely contents as suggested by existing public and private initiatives. Key takeaways we identify and discuss are:

• How the regulatory context to and objectives of climate transition plans differ across countries and agencies. Plans will likely need to encapsulate both mitigation and adaptation efforts, and anticipate a wide range of potential use cases. In addition, plans will also need to take into account national, regional and sectoral transition planning and pathways, and allow for changes on the basis of future developments (chapter 2).
• Imminent regulation may shift climate transition planning from a largely voluntary, disclosure-based approach only, towards a mandatory, substantive obligation. However, this imminent regulation is as in many respects unclear on the substantive requirements of the transition plan (chapter 3).
• The design and implementation of the transition plan requires an understanding of the undertaking's ambitions and the levers available to the undertaking to achieve the plan's strategic objectives and ambitions. Public and private initiatives, such as the TPT Disclosure Framework, provide guidance on the development of transition plans and, in most cases, promote an approach combining the mitigation and adaptation perspectives with an assessment of the undertaking's options to contribute to an economy-wide transition (chapter 4).

Given these developments, we believe that reflecting on corporate transition planning at a strategic level is appropriate. We hope our booklet will be helpful in this process.