LONDON - Financial firms and listed companies in Britain should push ahead with drawing up plans for transitioning to a net-zero economy before formal rules are finalised, the Financial Conduct Authority (FCA) said on Tuesday.

The FCA has already mandated asset managers and listed companies to publish, on a comply or explain basis, climate related disclosures since January 2022.

Plans to date based on the disclosures have varied in quality and lack detail on short-term actions to meet net-zero goals, a government-backed net-zero review said last month.

Britain's Transition Plan Taskforce (TPT) is developing mandatory standards for listed companies and financial firms to ensure comparable plans, with the work completed by the end of this year.

Mark Manning, sustainable finance specialist at the FCA, said listed companies and firms regulated by the watchdog should be using the TPT's draft guidance, currently out to public consultation, to write plans which will get feedback from the regulator.

"Ultimately we can't wait for perfection here. Increasingly, a company's transition plan is financially material information, material to a company's future prospects," Manning told a City & Financial Global conference.

Plans will help regulators combat greenwashing, or companies making statements on cutting carbon emissions without backing them up, Manning said.

"Talk is cheap. We are seeing a lot of commitments coming through, but they are not necessarily fully backed up by a strong plan."

Once the TPT final guidance is published, the FCA will set out stronger expectations on compliance, Manning said.

The plans dovetail with company sustainability disclosures being rolled out in the European Union, the United States and globally by the International Sustainability Standards Board (ISSB) over coming months for use in annual reports for 2024.

Patrick Arber, a member of the TPT's delivery group, said companies should not wait for absolutely perfect guidance on plans to be finalised.

"Don't fear having a go," Arber said.

The Glasgow Financial Alliance for Net Zero or GFANZ, a global financial industry body, has also worked on transition plan guidance for the sector.

"We think this year is the year of the transition plan," said Tony Rooke, head of transition planning implementation at GFANZ. "People can't just click their fingers and say I have a transition plan and it's going to work."

(Reporting by Huw Jones; Editing by Susan Fenton)