A comprehensive sustainable regulation plan and performance assessment for central banks and financial supervisors has been released by WWF. The new Sustainable Financial Regulations and Central Bank Activities (SUSREG) framework offers detailed practical guidance on integrating environmental and social considerations into financial supervision and monetary policy.
It forms the basis of an ongoing assessment of central banks and financial supervisors from G20 nations and 20 other countries. The first assessment will be published in June on a dedicated tracker website.
In a statement announcing the project, WWF finance practice leader Margaret Kuhlow emphasised the urgency of the environmental crisis and the importance of transitioning the financial system to sustainability.
“As nations prepare for international negotiations on climate and biodiversity, 2021 marks the start of a critical decade for reversing nature loss,” she said. “With the launch of the SUSREG framework and tracker, WWF is scaling up its work with central banks and financial supervisors who have a critical role to play in the transition to a more sustainable and resilient financial system that benefits people and nature.”
Introduced by former Bank of England governor Mark Carney, the new SUSREG framework covers microprudential banking supervision, supervisory expectations, disclosure and transparency, macroprudential supervision, monetary policy, and leadership and internal organisation.
The framework offers 67 specific indicators across these areas. It encourages central banks to take into account environmental and social considerations in their corporate asset purchase programmes, collateral frameworks, foreign exchange reserves and bank reserve requirements.
WWF developed the framework in consultation with a range of stakeholders, including academics, think tanks, financial supervisors and central banks. It incorporates the work and recommendations of the Network of Central Banks and Supervisors for Greening the Financial System, the Taskforce on Climate-related Financial Disclosures, and other leading international frameworks and initiatives.
Part of WWF’s Greening Financial Regulation Initiative, the new framework will be gradually expanded to cover other key parts of the financial system, including insurance, capital markets and asset management.
The launch of the WWF project complements last month’s publication of the Green Central Banking Scorecard from UK advocacy group Positive Money, which assessed the performance of G20 central banks and financial supervisors in aligning their activities with the science-based targets and pathways of the Paris Agreement.
This page was last updated May 6, 2021
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