Climate action

  • The PBoC has used a range of tools, including targeted refinancing operations, to guide lending in support of the green transition.

  • The PBoC has accepted green bonds as collateral in its lending facilities.

  • The PBoC has carried out a climate-related stress test.

Climate inaction

  • China’s regulators have faced accusations of greenwashing, as ‘clean coal’ remains present in a framework used in the implementation and assessment of green finance practices.

  • Although the PBoC provides interest subsidies for green loan-supported projects, experts have argued these should be higher.

  • Measures previously used to penalise the financing of environmentally harmful activities have since been discontinued.

How the People’s Bank of China 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)
6= ChinaChina 53 C 10 12 31 0

Central Bank/Supervisor

People's Bank of China and China Banking & Insurance Regulatory Commission

More info

Research & Advocacy

10 out of 10


  • N/A


  • PBoC is an NGFS member


Monetary Policy

12 out of 50


  • N/A


  • Carbon emission reduction facility – banks must offer reduced interest rates for loans to pollution control facilities, environmental protection and infrastructure, renewable energy etc (fully implemented); scorecard points suspended due to credit guidance towards coal under the “special central bank lending to support the clean and efficient use of coal”

  • PBoC’s notice regarding promoting credit asset and collateral in central bank evaluation established green bonds, loans and securities; ratings of AA and above accepted as collateral in medium-term lending facility and green loans accepted as part of the standing lending facility (referred to here; fully implemented)

  • Interest rate provided to banks on required reserves may be increased if the bank is assessed to be greener in the PBoC’s macroprudential assessments (referred to here)


  • PBoC issued notice on issues relating to improving environmental protection in credit policy, which provided guidance for banks on “how to better include environmental variables in credit decisions” (referred to here)

  • PBoC is increasing the allocation of green bonds in the country’s foreign exchange reserves

Financial Policy

31 out of 50


  • N/A


  • Banks and insurance institutions are required to gradually reduce the carbon intensity of asset portfolios in an orderly manner and finally realise the carbon neutrality of asset portfolios (as per green finance guidelines)

  • Banks are required to incorporate environmental risks into risk management and governance processes (see, for example, 2012 Notice on Issuing Green Credit Guidelines, referred to here)

  • Banks are required to shift lending towards environmentally friendly projects (see, for example, 2007 Opinions on Implementing Environmental Protection Policies and Rules and Preventing Credit Risks and the 2012 Notice on Green Credit Guidelines referred to here)

  • Banks are required to shift lending away from unsustainable projects (see, for example, 2007 Opinions on Implementing Environmental Protection Policies and Rules and Preventing Credit Risks and the 2012 Notice on Green Credit Guidelines referred to here; scorecard points temporarily suspended due to China’s current domestic credit guidance towards coal production

  • Mandatory climate risk disclosure for all financial firms (formal commitment; referred to here)

  • Lower risk weights for green assets (under discussion; referred to here)


  • PBoC conducted stress tests of 21 commercial banks and two development banks; only focused on the effects of increased emissions costs on asset quality and capital adequacy levels; results published

  • PBoC guidelines on environmental information disclosure for financial institutions: information on voluntary disclosures, which are encouraged to happen at least once a year

  • CBIRC issued opinions on energy efficiency and emission reductions in credit extension, which provided “specific guidance on how banks can contribute to national environmental goals” (referred to here)

  • CBIRC’s Notice of Submission of Green Credit Statistics requires that the 21 main banks report green credit statistics (referred to here)

  • CBIRC’s Notice of the Key Performance Indicators of Green Credit Implementation, which established “quantitative and qualitative indicators for assessing performance” (referred to here)

  • CBIRC issued guidelines on incorporating ESG requirements into the entire credit granting process (referred to here)

  • Banks and insurance institutions are required to establish green finance organisation and coordination mechanisms, and are encouraged to carry out innovaiton in green finance (under green finance guidance)

  • Banks and insurance institutions are encouraged to incorporate ESG requirements into management processes, disclosures and interaction with stakeholders (under green finance guidance)

  • CBIRC issued guidelines on environmental risk management systems (referred to here)

  • Inclusion of green bonds in the green finance evaluation plan, which will assess the share of green bonds in financial institutions’ total assets

  • Banks and insurance institutions are guided to actively support the green and low-carbon development efforts under the Belt and Road initiative (under green finance guidelines)

  • PBoC has said it will “not build coal-fired power plants abroad” (as the statement was vague and details are yet to be provided, this is a ‘low impact’ policy)

Leading by Example

0 out of 20


  • N/A


  • N/A


  • Green Bond Endorsed Projects Catalogue (2021): PBoC, China Securities Regulatory Commission and National Development and Reform Commission announced updated green bond guidelines which exclude “clean coal”

    Green Industry Guidance Catalogue still includes “clean utilisation of coal”

    Common ground taxonomy: comparison of EU and China taxonomies, to harmonise cross border green investment; can be used as a voluntary reference by market participants when issuing or trading green financial products.; based on Green Bond Endorsed Projects Catalogue, so excludes coal projects

What steps are missing in the People’s Bank of China toolbox to address climate risk?

Civil society expects the bank to do the following:

  • Wind down its support for fossil fuels, particularly coal power plants.

  • Raise the interest subsidies it provides for green loan-supported projects.

  • Remove ‘clean coal’ from its sustainable finance taxonomy.

  • Bring about improvements in the quality and consistency of corporate climate disclosures.