On October 13, 2022, the Financial Stability Board released two reports on climate-related risks that were provided to the G20 Finance Ministers and Central Bank Governors ahead of their October 12-13, 2022 meeting. The reports follow the FSB’s 2021 publication of its Roadmap for Addressing Climate-related Financial Risks, and consist of recommendations for supervisory and regulatory approaches to climate-related risks, and progress made to climate-related disclosures.
The FSB’s final report on Supervisory and Regulatory Approaches to Climate-Related Risks, address “approaches to monitor, manage and mitigate cross-sectoral and system-wide risks arising from climate change and to promote consistent approaches across sectors and jurisdictions”; and the Progress Report on Climate-Related Disclosures, assesses the progress made over the past year by the International Sustainability Standards Board (ISSB) on developing its global baseline climate reporting standard, as well as work by international standard setters (national and regional authorities), and by firms regarding sustainability reporting. The FSB’s goal is to strengthen disclosures so that they are consistent and effective. The Task Force on Climate-Related Financial Disclosures (TCFD), which was created by the FSB, also released a 2022 status report on "TCFD-aligned disclosures”.
The final report on Supervisory and Regulatory Approaches to Climate-Related Risks, highlights:
- Supervisory and regulatory reporting and collection of climate-related data from financial institutions.
- System-wide supervisory and regulatory approaches and the extent to which supervisory and regulatory tools and policies address climate-related risk.
- Early consideration of other potential macroprudential policies and tools.
The Progress Report on Climate-Related Disclosures, highlights:
- Progress made by the International Sustainability Standards Board (ISSB) in developing its global baseline standard.
- Actions undertaken by jurisdictions to require or promote climate-related disclosures.
- Firms’ progress in making climate-related disclosures, as reported in the 2022 TCFD Status Report.
More information on the FSB’s reports on climate-related risks and climate-related disclosures is available here.