Climate action

  • The Fed acknowledged climate risk in its financial stability report to Congress and in numerous speeches by governors.
  • The Fed has joined the Network for Greening the Financial System, making it the first U.S. regulator to do so.
  • The Fed established a new Supervision Climate Committee and announced a Financial Stability Climate Committee to advise the Board of Governors on how to address climate risk.
  • The Fed encouraged investment in renewable energy and climate resilience activities as part of the Community Reinvestment Act.

Climate inaction

  • Powell has not replied to letters from 25 House members and 65 civil society groups calling for the Fed to take bolder action on climate.
  • As part of its pandemic response, the Fed has disproportionately supported fossil fuel companies and assets in the secondary markets.
  • The Fed has not incorporated climate risk into its stress testing, capital framework and supervision of banks and designated important nonbank financial institutions.

How the Federal Reserve stacks up

Rank Country Aggregate Score (out of 130) Grade (A+ to F) Research and Advocacy (out of 10) Monetary Policy (out of 50) Financial Policy (out of 50) Leading by Example (out of 20)
13= United StatesUnited States 11 D- 10 0 1 0

Central Bank/Supervisor

Federal Reserve

More info


Research & Advocacy

10 out of 10

High-impact

  • N/A

Medium-impact

  • Member of NGFS

Low-impact

Monetary Policy

0 out of 50

High-impact

  • N/A

Medium-impact

  • N/A

Low-impact

  • N/A

Financial Policy

1 out of 50

High-impact

  • N/A

Medium-impact

  • N/A

Low-impact

Leading by Example

0 out of 20

High-impact

  • N/A

Medium-impact

  • N/A

Low-impact

  • N/A

What steps are missing in the Federal Reserve toolbox to address climate risk?

Civil society expects the bank to do the following:

  • Implement supervisory and prudential measures to manage climate-related risks to financial institutions and the financial system, including the risks that financial institutions are creating by financing fossil fuels and deforestation.
  • Incorporate climate risk into the Federal Reserve’s monetary policy and its collateral framework, and exclude fossil fuel assets from its future emergency asset purchase programs.
  • Encourage and support bank investment aimed at limiting global average temperature rise to 1.5°C, with a particular emphasis on lending to low-income communities and communities of color.