8-77 Council of Financial Regulators Climate Change Activity Stocktake 2021

Summary

This stocktake paper outlines the recent activities and planned further work of the Council of Financial Regulators Working Group on Financial Implications of Climate Change in relation to climate change risks. The CFR agencies in Australia are taking steps to help corporates and financial institutions manage the financial risks associated with climate change and provide comparable disclosures on these risks. The Climate Vulnerability Assessment (CVA) conducted by APRA on behalf of other CFR agencies in 2020/21 measures potential financial risks posed by both physical and transition climate risks using scenario analysis, and aims to improve banks' climate risk management capabilities. The CFR agencies are also building their understanding and knowledge about how to measure and manage climate-related risks through supervisory and regulatory engagement, collaboration with expert bodies, and participation in international forums where climate change issues are gaining increasing prominence.

Thumbnail image for This stocktake paper outlines the recent activities and planned further work of the Council of Financial Regulators Working Group on Financial Implications of Climate Change in relation to climate change risks. The CFR agencies in Australia are taking steps to help corporates and financial institutions manage the financial risks associated with climate change and provide comparable disclosures on these risks. The Climate Vulnerability Assessment (CVA) conducted by APRA on behalf of other CFR agencies in 2020/21 measures potential financial risks posed by both physical and transition climate risks using scenario analysis, and aims to improve banks' climate risk management capabilities. The CFR agencies are also building their understanding and knowledge about how to measure and manage climate-related risks through supervisory and regulatory engagement, collaboration with expert bodies, and participation in international forums where climate change issues are gaining increasing prominence.

Issuer

Australia

Year

2021

Region

Oceania

Issuer (type)

Council of Financial Regulators (Financial Regulator)

Policy Type

Disclosure

Geographical scope

National

Mandatory or voluntary

Voluntary

Main industries targeted

Finance & Insurance
Mining, Quarrying, Oil & Gas Extraction
Retail trade
Public administration

Restrictiveness

Low

Sustainable Development Goals (SDGs)

SDG 2: Zero Hunger
SDG 4: Quality Education
SDG 8: Decent Work and Economic Growth
SDG 9: Industry, Innovation, and Infrastructure
SDG 10: Reduced Inequality
SDG 13: Climate Action