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Bank of England: Supervisory Statement 3/19
Enhancing banks’ and insurers’ approaches to managing the financial risks from climate change
The Bank of England Climate change page is a gateway to a number of (often PRA) regulatory resources including the 2015 insurance report and:
- Transition in thinking: The impact of climate change on the UK banking sector, an early (2018) examination of the financial risks from climate change that impact the PRA’s role
- This was followed in April 2019 by Supervisory Statement SS 3/19 Enhancing banks' and insurers' approaches to managing the financial risks from climate change
- The December 2019 Discussion Paper The 2021 biennial exploratory scenario on the financial risks from climate change moved the UK regulatory position forward, although the timeline has slipped on account of the Covid situation. More recently, the PRA’s CEO letter Managing climate-related financial risk - thematic feedback from PRA's review of firms' SS3/19 plans moved things along and clarified the regulator’s expectations and timeline.
EIOPA has issued views on the integration of sustainability, in particular climate-related developments, into the Solvency II framework for the valuation of assets and liabilities, investment and underwriting practices, the calibration of market and natural catastrophe risks and the use of internal models.
Some of the NGFS publications address climate risk in bank business models from a regulatory perspective.
The Partnership for Climate Accounting Financials (PCAF) seeks to develop harmonised and transparent carbon accounting. This requires measuring and disclosing the GHG emissions associated with the lending and investment activities of financial institutions, creating transparency and accountability.