The Green Central Banking Scorecard, produced by Positive Money, scores and ranks the full range of green policies and initiatives adopted by G20 central banks. The analysis is based on a literature review, expert consultations, and bilateral interactions with central bankers and supervisors.
The 2024 ranking places the EU and its G20 member countries (France, Germany and Italy) in the top four positions, and Brazil and China also rank highly. The progress of these institutions provides real world examples of effective green policy implementation for other central banks to follow. In contrast, the lack of action by the US Federal Reserve on addressing environmental risks is identified as a global cause for concern.
The most advanced central banks have begun acknowledging the concept of double materiality, recognising both the financial causes and consequences of climate change in their policies and strategies. However, even among the top performers, there are substantial gaps in the adoption of high impact policies necessary to steer financial systems away from carbon-intensive activities and toward sustainable alternatives.
The breakdown below shows what actions have contributed to each country’s score. Unless stated otherwise, policies have been fully implemented.
Banque de France and ACPR are members of the NGFS. It also hosts its secretariat (20 staff members), which is headed by J Boissinot. Banque de France is also a member of the steering commitee, represented by its deputy governor, Agnès Benassy-Quéré. The ACPR is also a member of the steering committee.
Banque de France has been advocating for a robust double materiality approach in regulatory, supervisory and academic debates in international fora on this topic.
Low-impact
ACPR/AMF, 2022 (report)
Goulard, 2022 (speech)
Banque de France and INSPIRE Policy Briefing Paper (2022)
In 2023, 20% of Banque de France’s publications were related to climate or environmental issues.
Governor’s speech on the macroeconomics of climatw.
Monetary Policy
23 out of 50
High-impact
N/A
Medium-impact
The Eurosystem considers climate change risks when reviewing haircuts applied to corporate bonds used as collateral. Haircuts are reductions applied to the value of collateral based on its riskiness (formal commitment).
Longer-term refinancing operations to include climate change considerations (formal commitment).
ECB is tilting corporate bond holdings on a path aligned with the Paris agreement. The governing council decided to increase its tilt on 2 February 2023.
Operational framework review (formal commitment).
In 2022, the ECB conducted a climate risk stress test of the Eurosystem balance sheet as part of its action plan to include climate change considerations in its monetary policy strategy.
Low-impact
Climate-related financial disclosures of the Eurosystem’s corporate sector holdings for monetary policy purposes.
FAQ on incorporating climate change considerations into corporate bond purchases.
ECB accepts sustainability-linked bonds as collateral.
Climate change risks incorporated into annual reviews of haircuts applied to corporate bonds used as collateral.
Financial Policy
47 out of 50
High-impact
EBA working group dedicated to prudential treatment of sustainability risks, leading to a discussion paper concluding that a dedicated treatment for fossil-fuel related assets may be justified for the insurance sector (policy under discussion).
Involvement of policy experts in policy and methodological discussion at EBA level on the potential introduction of a sectoral systemic risk buffer (under discussion).
Climate-related quantitative and qualitative restrictions on banks’ portfolios (under discussion).
Requirement for banks to publish Paris-compatible transition plans under discussion at ECB. Action pending on regulations CRD6, CSRD and CSDDD.
Medium-impact
The importance of being transparent: a review of climate-related and environmental risks disclosures practices and trends.
Requirement for financial institutions to incorporate environmental risks into risk management processes.
Second ECB economy-wide climate stress test.
First ECB economy-wide climate stress test.
Microprudential climate-related capital-based measures (policy under discussion).
Setting deadlines for banks to meet the ECBs supervisory expectations for managing climate-related and environmental risks by the end 2024. In 2023 the ECB already issued binding supervisory decisions for 23 supervised entities, which envisage the accrual of periodic penalty payments for the 18 most relevant cases should the supervised entities fail to comply with the requirements regarding a materielty assessment within the deadlines set out in these decisions.
Low-impact
EBA published binding standards on climate risks within balance sheets, mitigating actions, green asset ratio and banking book taxonomy alignment ratio, and ESG risks.
2020 guide on climate-related and environmental risks.
2022 compendium of good practices.
2024 alignment report.
ECB report on good practices for climate stress testing.
ECB Thematic Review on Climate and Environmental Risks: results fed into the supervisory review process, impacting Pillar 2 capital requirments.
EBA launches public consultation on draft technical standards on Pillar 3 disclosures of ESG risks.
ECB will develop new statistical indicators to assess the carbon footprint of banks, as well as their exposures to climate-related physical risks.
ECB conducted a review on how credit ratings reflect climate risk and is urging rating agencies to be more transparent and ambitious on climate risk.
ACPR/ AMF joint reports monitoring climate commitments of French financial institutions (2021, 2022).
Leading by Example
16 out of 20
High-impact
Responsible investment charter for non-monetary portfolios to include explicit exclusions for fossil fuels (formal commitment).
Medium-impact
The Banque de France and ACPR supported the adoption and development of an unsustainable taxonomy at the EU level, by responding to the European Commission consultations on sustainable finance and to the call for feedback on the Platform on Sustainable Finance.
Responsible investment strategy for non-monetary portfolios.
Low-impact
Creation of a Climate Change Centre to ensure co-ordination of green initiatives at the BdF.
Awards a prize for young researchers in green finance.
Banque de France’s museum on economics, Citéco, offers resources on climate- and sustainability-related issues.
An extensive internal training strategy of all staff has been carried out since 2022 within the Banque de France University.
Since 2016, the BdF has organised an annual academic conference on climate-related topics.
The EMuSe model, one of the in-house macro models, features energy, emissions and climate damages, allowing the feedback effects to physical and transition risks when analysing monetary policy to be taken into account.
Low-impact
N/A
Monetary Policy
23 out of 50
High-impact
N/A
Medium-impact
The Eurosystem considers climate change risks when reviewing haircuts applied to corporate bonds used as collateral. Haircuts are reductions applied to the value of collateral based on its riskiness (formal commitment).
Longer-term refinancing operations to include climate change considerations (formal commitment).
ECB is tilting corporate bond holdings on a path aligned with the Paris agreement. The governing council decided to increase its tilt on 2 February 2023.
Operational framework review (formal commitment).
In 2022 the ECB conducted a climate risk stress test of the Eurosystem balance sheet as part of its action plan to include climate change considerations in its monetary policy strategy.
Sustainable investment framework for the foreign reserve assets, including supranational, national and local debt, in order to promote investment in green assets.
Climate-related financial disclosures of the Eurosystem’s corporate sector holdings for monetary policy purposes.
FAQ on incorporating climate change considerations into corporate bond purchases.
ECB accepts sustainability-linked bonds as collateral.
Climate change risks incorporated into annual reviews of haircuts applied to corporate bonds used as collateral.
Low-impact
N/A
Financial Policy
48 out of 50
High-impact
EBA working group dedicated to prudential treatment of sustainability risks, leading to a discussion paper concluding that a dedicated treatment for fossil-fuel related assets may be justified for the insurance sector (policy under discussion).
Involvement of policy experts in policy and methodological discussion at EBA level on the potential introduction of a sectoral Systemic Risk Buffer (under discussion).
Climate-related quantitative and qualitative restrictions on banks’ portfolios (under discussion).
Requirement for banks to publish Paris-compatible transition plans under discussion at ECB. Action pending on regulations CRD6, CSRD and CSDDD.
Medium-impact
The importance of being transparent: a review of climate-related and environmental risks disclosures practices and trends.
Requirement for financial institutions to incorporate environmental risks into risk management processes.
Second ECB economy-wide climate stress test.
First ECB economy-wide climate stress test.
Microprudential climate-related capital-based measures (policy under discussion).
Setting deadlines for banks to meet the ECBs supervisory expectations for managing climate-related and environmental risks by the end 2024. In 2023 the ECB already issued binding supervisory decisions for 23 supervised entities, which envisage the accrual of periodic penalty payments for the 18 most relevant cases should the supervised entities fail to comply with the requirements regarding a materielty assessment within the deadlines set out in these decisions.
Low-impact
EBA published binding standards on climate risks within balance sheets, mitigating actions, green asset ratio and banking book taxonomy alignment ratio, and ESG risks.
2020 guide on climate-related and environmental risks.
2022 compendium of good practices.
2024 alignment report.
ECB report on good practices for climate stress testing.
ECB Thematic Review on Climate and Environmental Risks: results fed into the supervisory review process, impacting Pillar 2 capital requirements.
BaFin publishes guidance note on sustainability risks including guidelines on ESG criteria.
Leading by Example
10 out of 20
High-impact
N/A
Medium-impact
The Bundesbank manages third-party equity portfolios by replicating indices classified as Paris Aligned Benchmarks (PAB).
The Bundesbank also manages third-party equity portfolios by replicating indices classified as Climate Transition Benchmarks (CTB).
Low-impact
Sustainable investment policies in Bundesbank’s euro-denominated non-monetary policy portfolio includes tilting based on carbon risk rating and greenhouse gas intensity.
Disclosure of climate-related information of its own balance sheet.
Discussions related to sustainability at the Euro20+ event, a two-day forum targeted at young people.
Series of public debates organised by the regional branches of the Bundesbank, under the initiative Forum Bundesbank for Citizens, with the topic “How climate change is changing financial markets and what central banks can do?”.
Bundesbank has an internal environmental policy.
Designing Climate Policies series of events hosted jointly by the Deutsche Bundesbank, the Center for Liberal Modernity and the Potsdam Institute for Climate Impact Research.
Establishment of a sustainability hub within the bank, a department that coordinates the sustainability-related activities across the institution, working in close contact with the executive board.
Committed to particularly sustainable building design and construction in the refurbishment of the Bundesbank offices.
Green Finance Dashboard, hosted by the Bundesbank, tracks national emissions and green finance metrics.
Four meetings with regional parties of the Chamber of Industry and Commerce (IHK) with regard to questions on climate-related disclosure requirements.
Paolo Angelini, BoI deputy governor, has been a member of the NGFS steering commeittee since January 2022, and Banca d’Italia chairs an NGFS workstream.
Low-impact
Angelini (2024), Portfolio Decarbonisation Strategies: Questions and Suggestions
Aiello et al (2024), Climate-related Risks for Italy: An Analysis Based on the Latest NGFS Scenarios
Angelini, 2024 (speech), conference on UN Principles for Green Financing for Sustainable Real Estate, Infrastructure and Urban Transformation Project
de Blasio et al (2024), Improving the energy efficiency of homes in Italy
Bernardini et al (2024), Environmental data and scores: lost in translation, forthcoming in the Journal of Corporate Social Responsibility and Environmental Management
Zaghini (2024), Unconventionally Green
Monetary Policy
23 out of 50
High-impact
N/A
Medium-impact
The Eurosystem considers climate change risks when reviewing haircuts applied to corporate bonds used as collateral. Haircuts are reductions applied to the value of collateral based on its riskiness (formal commitment).
Longer-term refinancing operations to include climate change considerations (formal commitment).
ECB is tilting corporate bond holdings on a path aligned with the Paris agreement. The governing council decided to increase its tilt on 2 February 2023.
Operational framework review (formal commitment).
In 2022 the ECB conducted a climate risk stress test of the Eurosystem balance sheet as part of its action plan to include climate change considerations in its monetary policy strategy.
Low-impact
Climate-related financial disclosures of the Eurosystem’s corporate sector holdings for monetary policy purposes.
FAQ on incorporating climate change considerations into corporate bond purchases.
ECB accepts sustainability-linked bonds as collateral.
Climate change risks incorporated into annual reviews of haircuts applied to corporate bonds used as collateral.
Financial Policy
48 out of 50
High-impact
EBA working group dedicated to prudential treatment of sustainability risks, leading to a discussion paper concluding that a dedicated treatment for fossil-fuel related assets may be justified for the insurance sector (policy under discussion).
Involvement of policy experts in policy and methodological discussion at EBA level on the potential introduction of a sectoral systemic risk buffer (under discussion).
Climate-related quantitative and qualitative restrictions on banks’ portfolios (under discussion).
Requirement for banks to publish Paris-compatible transition plans under discussion at ECB. Action pending on regulations CRD6, CSRD and CSDDD.
Medium-impact
The importance of being transparent: a review of climate-related and environmental risks disclosures practices and trends.
Requirement for financial institutions to incorporate environmental risks into risk management processes.
Second ECB economy-wide climate stress test.
First ECB economy-wide climate stress test.
Microprudential climate-related capital-based measures (policy under discussion).
Setting deadlines for banks to meet the ECBs supervisory expectations for managing climate-related and environmental risks by the end 2024. In 2023 the ECB already issued binding supervisory decisions for 23 supervised entities, which envisage the accrual of periodic penalty payments for the 18 most relevant cases should the supervised entities fail to comply with the requirements regarding a materielty assessment within the deadlines set out in these decisions.
Low-impact
EBA published binding standards on climate risks within balance sheets, mitigating actions, green asset ratio and banking book taxonomy alignment ratio, and ESG risks.
2020 guide on climate-related and environmental risks.
2022 compendium of good practices.
2024 alignment report.
ECB report on good practices for climate stress testing.
ECB Thematic Review on Climate and Environmental Risks: results fed into the supervisory review process, impacting Pillar 2 capital requirments
EBA launches public consultation on draft technical standards on Pillar 3 disclosures of ESG risks.
ECB will develop new statistical indicators to assess the carbon footprint of banks, as well as their exposures to climate-related physical risks.
ECB conducted a review on how credit ratings reflect climate risk and is urging rating agencies to be more transparent and ambitious on climate risk.
Supervisory assessment of institutions’ climate-related and environmental risks disclosures.
Banca d’Italia document on supervisory expectations for climate-related and environmental risks in corporate strategies, governance and control systems, risk management frameworks and disclosure requirements.
Internal committee for the supervision of environmental risks.
Information gathering by Banca d’Italia on environmental risk awareness in less significant banks and ESG integration in asset management companies.
Regional Bank Lending Survey: assesses banks’ evaluation of climate risks on their credit portfolio.
Leading by Example
10 out of 20
High-impact
N/A
Medium-impact
N/A
Low-impact
The Banca d’Italia, acting as co-lead of NGFS sustainable and responsible investment group and co-chair of net-zero workstream, has steered the drafting of three SRI reports/documents that assess: a) central banks progresses and challenges with 10 recommendations for SRI implementation; b) decarbonization strategies for corporate portfolios (pitfalls and remedies), consideration of climate-related risk metrics for sovereign porfolios (data pros and cons).
Research endeavors aimed at assessing the exposure of the Italian financial system to transition risk utilise a novel methodology known as carbon critical sectors (CCrS).
Responsible investment charter for non-monetary portfolios: tilting portfolio towards firms with decarbonisation plans..
Report on sustainable investments and climate related risks: discloses methodology and results of incorporating ESG into Banca d’Italia’s non-monetary portfolios.
Banca d’Italia is a member of the Italian Natural Capital Committee, led by the Ministry of Environment, which prepares an annual report on the state of natural capital with a group of experts from universities and research centers. The report is submitted to the Italian prime minister and the Ministry of Finance.
Banca d’Italia’s financial education website has a dedicated page on sustainable and green finance.
Creation of an external climate change and sustainability hub.
Creation of an internal climate change and sustainability committee.
Thirteen training courses for internal staff since March 2022: green finance, sustainability, carbon neutrality and net zero, UN Agenda 2030.
Environment policy for Banca d’Italia operations: resources, waste, mobility, procurement, culture with commitment to becoming net-zero aligned.
Issues annual environmental reports.
Banca d’Italia has included a set of environmental actions in its strategic plan for 2023-25, a document that defines its vision and objectives and devises specific action plans. One of the five key strategic objectives in the plan is to support the energy transition and protect the environment.
Double materiality approach. ECB strategy is based on three strategic objectives: managing climate-related risks, supporting the green transition, and fostering wider actions.
Low-impact
N/A
Monetary Policy
23 out of 50
High-impact
N/A
Medium-impact
The Eurosystem considers climate change risks when reviewing haircuts applied to corporate bonds used as collateral. Haircuts are reductions applied to the value of collateral based on its riskiness (formal commitment).
Longer-term refinancing operations to include climate change considerations (formal commitment).
ECB is tilting corporate bond holdings on a path aligned with the Paris Agreement. The Governing Council decided to increase its tilt on 2 February 2023.
Operational framework review (formal commitment).
In 2022, the ECB conducted a climate risk stress test of the Eurosystem balance sheet as part of its action plan to include climate change considerations in its monetary policy strategy.
Low-impact
Climate-related financial disclosures of the Eurosystem’s corporate sector holdings for monetary policy purposes.
FAQ on incorporating climate change considerations into corporate bond purchases.
ECB accepts sustainability-linked bonds as collateral.
Climate change risks incorporated into annual reviews of haircuts applied to corporate bonds used as collateral.
Financial Policy
44 out of 50
High-impact
EBA working group dedicated to prudential treatment of sustainability risks, leading to a discussion paper concluding that a dedicated treatment for fossil-fuel related assets may be justified for the insurance sector (policy under discussion).
Involvement of policy experts in policy and methodological discussion at EBA level on the potential introduction of a sectoral systemic risk buffer (under discussion).
Climate-related quantitative and qualitative restrictions on banks’ portfolios (under discussion).
Requirement for banks to publish Paris-compatible transition plans under discussion at ECB. Action pending on regulations CRD6, CSRD and CSDDD.
Medium-impact
The Importance of Being transparent: A review of Climate-related and Environmental Risks Disclosures, Practices and Trends (2023)
Requirement for financial institutions to incorporate environmental risks into risk management processes.
Second ECB economy-wide climate stress test.
First ECB economy-wide climate stress test.
Microprudential climate-related capital-based measures (policy under discussion).
Setting deadlines for banks to meet the ECBs supervisory expectations for managing climate-related and environmental risks by the end 2024. In 2023 the ECB already issued binding supervisory decisions for 23 supervised entities, which envisage the accrual of periodic penalty payments for the 18 most relevant cases should the supervised entities fail to comply with the requirements regarding a materielty assessment within the deadlines set out in these decisions.
Low-impact
EBA published binding standards on climate risks within balance sheets, mitigating actions, green asset ratio and banking book taxonomy alignment ratio, and ESG risks.
2020 guide on climate-related and environmental risks.
2022 compendium of good practices.
2024 alignment report.
ECB report on good practices for climate stress testing.
ECB Thematic Review on Climate and Environmental Risks: results fed into the supervisory review process, impacting Pillar 2 capital requirements.
EBA launches public consultation on draft technical standards on Pillar 3 disclosures of ESG risks.
ECB will develop new statistical indicators to assess the carbon footprint of banks, as well as their exposures to climate-related physical risks.
ECB conducted a review on how credit ratings reflect climate risk and is urging rating agencies to be more transparent and ambitious on climate risk.
Supervisory assessment of institutions’ climate-related and environmental risks disclosures.
BCB is a member of the steering committee of NGFS since Jan 2022 (two-year term mandate), representing the presidency of G20 in 2024.
Low-impact
Financial stability reports (November 2022 and May 2023) include analysis of exposure of financial system to i) transition risk and ii) extreme drought (Nov 22) and iii) heavy rains (May 23).
Presentations and speeches on the BCB’s sustainability website page.
Monetary Policy
18 out of 50
High-impact
Formal commitment to participation in Eco Invest Brasil, an initiative of the Brazilian government developed to create structural conditions to attract necessary external private investments for the ecological transformation of the country.
Medium-impact
Ban on financing for sugar cane crop expansion in the Amazon, Pantanal and other zones.
Condition on rural credit in the Amazon whereby borrowers must show proof of environmental compliance (study on impact on deforestation; criteria have recently been expanded and strengthened).
Low-impact
Sustainability criteria in the management of international reserves and monitoring of CO2 emissions to assess portfolio’s carbon profile.
Public consultation on sustainability criteria applicable to rural credit operations.
Financial Policy
33 out of 50
High-impact
Improvement on disclosure requirements is under public consultation to include quantitative information on sector-specific exposures and transition plans (policy under discussion).
Medium-impact
Banks are required to disclose qualitative information on strategies, policies and management of social, environmental and climate risks.
Banks are also required to consider the social, environmental and climate risks in their integrated risk management, and this must be reflected in the strategic decision making process as well as in their capital planning.
Regulation CMN No 4.557 requires financial institutions to carry out stress testing and scenario analysis considering climate change, among other variables and scenarios.
Social, environmental and climate related risks are incorporated to the Internal assessment of capital adequacy and to the supervisory review process of ICAAP.
Bank participation in the IAIS Climate Risk Steering Group.
Financial institutions must implement and disclose a responsibility policy on social, environmental and climate-related aspects, as well as the actions to carry out such policy and the methodology to evaluate the effectiveness of these actions.
Low-impact
Creation of new indicators to monitor social, environmental, and climate risks.
Leading by Example
10 out of 20
High-impact
N/A
Medium-impact
After inter-institutional working group discussions, and a public consultation, the roadmap of Brazilian taxonomy was launched at Cop28. A committee responsible for the development of Brazilian Sustainable Taxonomy was then established (formal commitment).
Low-impact
International reserves portfolio has some sustainable investment considerations.
The BCB is part of the taskforce responsible for developing an action plan to prepare the national sustainable taxonomy, led by the Ministry of Finance. The expectation is that the national sustainable taxonomy plays a relevant role in guiding future issuances.
Disclosure of BCB’s climate risks.
G20 Techsprint 2024 with focus on sustainable finance solutions.
The Lift Learning 2024 focused on sustainable finance. Lift Learning is a Fenasbac program, in partnership with the Banco Central do Brazil, which brings together banks, payment institutions and fintechs with higher education institutions to develop innovative solutions that benefit the national financial system and the population.
Results of the 2024 edition of the Financial Stability Survey presented at event 6º Café com PLS – Conheça o Caminho Verde do Banco Central.
Creation of the Sustainability Economy Committee (Ecos), which co-ordinates the external and international initiatives, projects and activities in different areas of the BCB related to sustainability.
Creation of the Committee for Organizational Social and Environmental Responsibility (CRSO).
The BCB has the goal of carbon neutrality in operations, including the Sustainable Logistics Management Plan (PGLS 2019-2020 and 2021-2022) which implemented sustainability in waste management of the bank.
Thematic exposition of sustainable finance at the BCB’s Museum of Economy.
Reduction of the environmental impact of the cash cycle.
The People’s Bank of China (PBoC) is a member of NGFS.
PBoC, Financial Support for Biodiversity Conservation, 2022 (report)
Staff working paper, 2022
Research Group of the PBC Research Bureau, 2022 (policy research paper)
Speech by Governor Yi Gang at the launch ceremony of Building a National-level Green Exchange at the Beijing Municipal Administrative Center.
Q&A with Governor Yi Gang at SCarbon Neutrality: Dilemma and Way Out, a sub-forum of the Boao Forum for Asia Annual Conference 2023.
Vice Minister Zhou Liang’s speech at the China International Finance Annual Forum 2023.
Speech by Li Yunze at the 17th Asian Financial Forum in Hong Kong: Ppomoting high-quality financial development and boosting Asian financial cooperation.
In April 2023, Singapore and China established the Green Finance Taskforce (GFTF) to strengthen collaboration in green and transition Finance. In December 2023, it was announced that the GFTF was working on key initiatives.
Member of the G20 Sustainable Finance Working Group, and previous co-chair.
Monetary Policy
22 out of 50
High-impact
N/A
Medium-impact
PBoC’s Notice Regarding Promoting Credit Asset and Collateral in Central Bank Evaluation established green bonds, loans and securities with an AA rating and above accepted as collateral in medium-term lending facility, and green loans accepted as part of the standing lending facility.
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.
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.
Carbon Emission Reduction Facility: banks must offer reduced interest rates for loans to pollution control facilities, environmental protection and infrastructure, renewable energy (partially suspended due to previously operating a coal-lending facility).
Low-impact
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”.
PBoC is increasing the allocation of green bonds in the country’s foreign exchange reserves.
Financial Policy
31 out of 50
High-impact
The PBoC announced that the China Banking and Insurance Regulatory Commission issued green finance guidelines for the banking and insurance sector. 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 the Green Finance Guidelines).
Medium-impact
Mandatory climate risk disclosure for all financial firms (formal commitment).
China is experimenting with green policies at both the national and municipal levels within of “green finance pilot zones“, which aim to try out different approaches to green finance in regions that reflect different economic and developmental situations before rolling them out more widely.
Low-impact
China Banking and Insurance Regulatory Commission (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”.
CBRC issued guidelines on incorporating ESG requirements into the entire credit granting process.
In June 2022, the China Banking and Insurance Regulatory Commission issued guidance requiring banks and insurance companies to, among other things, “reduce the carbon intensity of their asset portfolios in a gradual and orderly manner, and eventually achieve carbon neutrality of asset portfolios” and “support key industries and fields in energy conservation, pollution reduction, carbon reduction, and greening”.
“China’s Green Bond Standard Committee (a cooperation among PBOC, NAFMII and CSRC, with private sector institutions participating) announced the long-awaited China’s Green Bond Principles (China GBP)”
Green Bond Endorsed Projects Catalogue (2021): PBoC, CSRC, NDRC announced updated green bond guidelines which exclude “clean coal”.
Banks and insurance institutions are guided to actively support the green and low-carbon development efforts under the Belt and Road initiative (under CBIRC Green Finance Guidelines).
CBIRC’s Notice of Submission of Green Credit Statistics requires that the 21 main banks report green credit statistics.
CBRC Notice of the Key Performance Indicators of Green Credit Implementation, which established “quantitative and qualitative indicators for assessing performance”.
Inclusion of green bonds in the Green Finance Evaluation Plan, which will assess the share of green bonds in financial institutions’ total assets.
NEA Green Certificates for verifying renewable power consumption at the national level.
China’s Certificated Emission Reduction (CCER) officially relaunched, with a standardised framework and process for voluntary emissions trading.
Leading by Example
3 out of 20
High-impact
N/A
Medium-impact
N/A
Low-impact
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.
China’s Green Finance Committee, which is led by the People’s Bank of China, spent several months reviewing bonds to determine if they were in line with the taxonomy. The green bonds raised 251.3bn yuan (US$35bn) between 2016 and 2023 and were issued by mostly state-backed public transport and clean-energy companies.
The People’s Bank of China, the Ministry of Ecology and Environment, the National Financial Regulatory Administration and the China Securities Regulatory Commission jointly held a seminar promoting green financial services.
The Bank of England (BoE) is a member of the NGFS steering committee.
Low-impact
Climate Change: Possible Macroeconomic Implications (bulletin)
Research report analysing the macroprudential policy and climate change.
The July 2022 Financial Stability Report considers the potential relevance of other environmental risks to their primary objective.
BoE report on climate-related risks and the regulatory capital frameworks.
Hosted the Climate and Capital Conference.
Virtual conference in December 2023 focusing on climate disclosures and transition plans from a central banking perspective.
The BoE support for UK government green strategy 2023 and review of net zero.
Financial Stability Board set up the climate vulnerabilities and data group
Participates in the Sustainable Insurance Forum.
The BoE is an observer on the Treasury’s Transition Plan Taskforce (TPT), which is “helping to define the standards for transition plans by establishing robust criteria and the effective use of science-based targets”.
NGFS monetary policy workstream chaired by James Talbot, the BoE’s international directorate executive director.
Steps taken to mitigate climate-related financial risks to residential mortgage collateral posted in the sterling monetary framework. Build on the earlier collection of data on energy performance certificate ratings of mortgages pledged as collateral.
Updates to credit risk assessment methodologies to identify climate risks within each asset class in the BoE’s market operations.
Financial Policy
24 out of 50
High-impact
N/A
Medium-impact
Requirement for financial institutions to disclose transition plans (formal commitment as part of sustainability disclosure requirements).
The BoE has committed to implementing mandatory TCFD disclosure for banks and insurers, alongside sustainability disclosure requirements (formal commitment).
Financial institutions are required to integrate climate risk into their risk management practices.
The BoE published the results of the Climate Biennial Exploratory Scenario, which explores the financial risks posed by climate change for the UK’s largest banks and insurers.
Low-impact
Thematic feedback on the PRA’s supervision of climate-related financial risk and the BoE’s Climate Biennial Exploratory Scenario exercise.
Letter to CFOs sharing thematic findings from its review of written auditor reports for major UK banks.
Prudential Regulation Authority assessment of firms’ approaches to climate in capital adequacy process, own risk solvency assessments, and Pillar 3 disclosures.
FCA has issued a consultation to bring climate-related disclosures in line with the ISSB standards.
The BoE advocates for interoperability between global climate disclosures standards, and is contributing to the Basel Committee’s Task Force on Climate-related Financial Risks’ (TFCR) development of the Pillar 3 disclosure framework.
FCA supervisory action: letters providing guidance to financial firms.
FCA support for the ISSB’s proposed global standards for sustainability disclosures.
Report regarding the Climate Change Act of 2008, setting out how climate change affects responsibilities and the actions the financial sector are taking. Includes supervisory guidance.
Leading by Example
8 out of 20
High-impact
N/A
Medium-impact
N/A
Low-impact
Training on managing climate-related financial risks for other central banks through the Centre for Central Banking Studies.
Joint work with the FCA to convene the Climate Financial Risk Forum. Annual meeting on March 2023, documentation published online.
Work with the UK government to deliver progress on climate, including disclosure of progress made against the G20 Sustainable Finance Roadmap.
Bank participation in the IAIS Climate Risk Steering Group.
The Bank of Japan and Japan’s Financial Services Agency (FSA), published the second scenario analysis, progressing on the results from the pilot scenario preformed in 2021, in which a double materiality framework is considered (policy under discussion).
Low-impact
The BoJ and FSA are members of the NGFS.
FSA press release about the Report of the Technical Committee for ESG Evaluation and Data Providers.
Monetary and Economic Studies (BoJ paper)
Addressing the Challenges of Financed Emissions (FSA paper)
The FSA released Formulation of the Transition Finance Follow-up Guidance Announced
Monetary Policy
16 out of 50
High-impact
N/A
Medium-impact
Japan climate transition bonds in the BoJ’s market operations.
The BoJ had a lending scheme at 0% interest rate until 21 March 2024, when it was changed to 0.1%. However, the definition of “green” is left to the participating organisations. Each counterparty must disclose the criteria used to determine if the investment or loan addresses climate change.
BoJ’s Climate Change Initiatives: Disclosure Based on TCFD Recommendations (formal commitment).
Low-impact
The BoJ is including five and 10 year Japan climate transition bonds in asset purchasing programs.
Japan climate transition bonds included in the BoJ’s market operations.
The Loan Support Program offers loans at below market rate to financial institutions to support priority lending sectors, including environmentally focused business.
Financial Policy
16 out of 50
High-impact
N/A
Medium-impact
The BoJ and FSA publish the Supervisory Guidance on Climate-related Risk Management and Client Engagement, and are supervising progress on the On-Site Examination Policy for Fiscal 2023 and On-Site Examination Policy for Fiscal 2024.
Low-impact
Supervisory Guidance on Climate-related Risk Management and Client Engagement, issued by the BoJ and FSA.
The BoJ and FSA published the Pilot Scenario Analysis Exercise on Climate-Related Risks Based on Common Scenarios
Response to the FSA’s consulation on the Proposed Amendment of the Comprehensive Supervisory Guidelines for Financial Instruments Business Operators, etc. regarding ESG investment trusts.
Finalisation of the Basic Guidelines on Impact Investment (Impact Finance)
FSA Expert Panel on Sustainable Finance, second report.
The Code of Conduct for ESG Evaluation and Data Providers：21 ESG evaluation and data providers have endorsed the code as of 31 December 2023.
The BoJ announced disclosure aligned with the Task Force on Climate-related Financial Disclosures.
BoJ reducing emissions in operations.
FSA and JPX will establish an information platform on green bonds.
FSA establishing a framework for objectively confirming the eligibility of green bonds (formal commitment).
BoJ holds seminars for financial institutions covering various topics including SDGs and ESG.
BoJ set up the Climate Coordination Hub to co-ordinate bank wide initiatives on climate change.
In relation to the EMEAP, the BoJ played a key role in discussions on economic and financial conditions in the region as well as in the management of the Asian Bond Fund, in the course of which it also advanced initiatives to catalyze further deepening of green bond markets.
Asia GX (Green Transformation) Consortium holds kick-off meeting.
Energy Transition: Prospect and Challenges at Asean+3 Countries (working paper)
Climate Vulnerability: Promote More Green Investment? (working paper)
Green Transition Risks on Export Competitiveness: Circular Economy Approach (working paper)
The Bank of Indonesia is a member of the G20 Sustainable Finance Working Group.
Monetary Policy
14 out of 50
High-impact
N/A
Medium-impact
Foreign reserves management: as of 2023, BI’s reserves asset portfolio has 5%, or US$7bn, allocated to the BIS-Asian Green Fund (BISIP-G3), which is a fund that support green projects in the Asia Pacific Region.
The Bank of Indonesia has issued the sukuk Bank Indonesia (SukBI) with 100% of underlying is green government sukuks.
From 2024, the Bank of Indonesia (BI) will pursue the development and implementation of green money market instrument (formal commitment).
Low-impact
This policy complements the green loan-to-value requirements introduced in 2019 and strengthened in 2020, which allow banks to offer green mortgages and loans for electric vehicle ownership with up to 0% down payment (or 100% LTV).
Financial Policy
15 out of 50
High-impact
N/A
Medium-impact
Climate risk stress testing guide for banking issued.
The Bank of Indonesia has implemented borrower-based prudential measures for incentivising financing of green automotives and housing.
Low-impact
The Otoritas Jasa Keuangan (OJK) issued the Climate Risk Management & Scenario Analysis (CRMS) Guideline, which details the OJK’s policy on climate change risk management.
The OJK issued the Financial Services Authority Regulation Number 18 of 2023 on Issuance and Requirements for Debt Securities and Sukuk Based on Sustainability (POJK 18/2023).
The OJK issued a clean energy handbook for financial institutions.
The OJK Trading Close of 2023 and report of the Carbon Exchange. The exchange is claimed to support the government commitment to achieve the national determined contribution target as written in the Paris Agreement.
The Bank of Indonesia accepts sustainable bonds within the macroprudential inclusive financing ratio.
Leading by Example
4 out of 20
High-impact
N/A
Medium-impact
N/A
Low-impact
The Bank Indonesia Institute and WWF in Indonesia, supported by the Greening Financial Regulation Initiative, organised a workshop in on nature, the economy and the financial system, in collaboration with the Asean+3 Macroeconomic Research Office and the LSE Grantham Research Institute on Climate Change and the Environment.
In 2023, the OJK issued the Indonesia Capital Market Roadmap 2023-2027.
OJK published the Sustainable Finance Roadmap Phase II (2021-2025).
Inarno Djajadi, chair of the Asean Capital Market Forum and an OJK executive, released a publication detailing the main achievements of the ACMF during 2023, which includes the Asean Corporate Governance Scorecard in which sustainability is the new main pillar.
Report on Currency and Finance 2022-23, with the theme Towards a Greener Cleaner India, was released in May 2023.
Economic Impact of Climate Change on Coastal States.
Decomposition Analysis of Carbon Dioxide Emissions from India’s Manufacturing Sector.
Monetary Policy
5 out of 50
High-impact
N/A
Medium-impact
Targeted new scheme to provide low-cost funds to banks for onward lending (policy under discussion).
Revamped collateral policy to allow relatively higher relaxation in margin requirements for accepting sovereign green bonds (policy under discussion).
Low-impact
The Securities and Exchange Board of India (SEBI) has issued guidelines that objectively define the purposes for which funds can be raised through “green debt security” and the scope has been enhanced to include pollution prevention and control; circular economy; and eco-efficient products (2023).
Consultative discussion paper assessing the progress of regulated entities in managing climate risk, covering governance, strategy, risk management and disclosure.
On 29 December 2023, a set of FAQs was published on the Reserve Bank’s website, aiming to offer clarifications and address common queries related to the green deposit framework .
Financial Policy
13 out of 50
High-impact
N/A
Medium-impact
Draft Disclosure Framework on Climate-related Financial Risks 2024 includes a commitment to mandatory disclosure for banks and other regulated entities (formal commitment).
Mandating financial institutions to incorporate environment risk factors in their risk management process is consiered in the report on currency and finance (under discussion).
System-wide climate stress testing to be conducted (formal commitment).
Lower risk weights for low-risk green loans is being considered after several regulatory institutions have advocated relaxing risk weights for sectors with low carbon footprints to incentivise banks to extend more credit to those sectors (under discussion).
Implementing a green supporting factor is being considered to relax the capital requirement for investments in the green sector (under discussion).
Low-impact
The SEBI has issued guidelines that define the purposes for which funds can be raised through ‘green debt security’ and the scope has been enhanced to include pollution prevention and control, circular economy, and eco-efficient products.
Consultative discussion paper assessing the progress of regulated entities in managing climate risk, covering governance, strategy, risk management, and disclosure.
Published a frequently asked questions web page that offers clarifications and addresses common queries related to the RBI’s green deposit framework.
Framework for the acceptance of green deposits by regulated entities.
Support for the government’s sovereign green bonds issuance, and inclusion of sovereign green bonds under the FAR V.15 policy.
Leading by Example
7 out of 20
High-impact
N/A
Medium-impact
N/A
Low-impact
Creation of a sustainable finance group to co-ordinate regulatory initiatives in the areas of sustainable finance and climate risk.
The RBI signed a memorandum of understanding with the India Meteorological Department on 14 March 2024 for more collaboration on climate change work through information sharing, analysis, and forecasting.
Seminar for central bank delegates on the role of central banks in green financing.
The RBI has the objective of achieving green ratings for its office and residential spaces.
Has implemented a GREEN data platform to monitor progress towards green ratings for its office and residential spaces.
Has already recieved high green ratings for multiple premises, including the RBI headquarters.
The RBI is working with India’s finance ministry to develop a sustainable finance taxonomy.
Sean Carmody, executive director of Australian Prudential Regulation Authority’s insurance division, was appointed to the NGFS steering committee in 2023 for a two-year term.
Low-impact
Reserve Bank of Australia and APRA are members of the NGFS.
The RBA is a member of, and APRA currently chairs, the Council of Financial Regulators’ Climate Working Group (CFR-CWG).
RBA co-led a Financial Stability Board workstream on monitoring climate-related risks and vulnerabilities in 2022 and continues to participate in the workstream.
RBA participates in the BIS Asia Climate Network, G20 Sustainable Finance Working Group, and various other international and regional forums that focus on climate-related risks.
APRA is a member of the Basel Committee on Banking Supervision (BCBS), and participates in the Task Force on Climate-related Financial Risks (TFCR).
APRA is a member of the International Associated of Insurance Supervisors’ Sustainable Insurance Forum, platform for insurance supervisors and regulators who want to address sustainability issues.
APRA issued Prudential Practice Guide: Investment Governance SPG 530, setting guidance to regulated superannuation pension funds on integrating ESG risk into investment governance frameworks.
APRA conducting climate risk self-assessment surveys to understand how regulated entities’ current practices are aligned with APRA prudential guidance on climate risks, CPG 229. The first survey was conducted in 2022, with findings published in September 2022. APRA is currently running a second iteration, with findings expected to be published in the later half of 2024.
In January 2024, deputy governor Fundi Tshazibana was appointed as vice-chair of the NGFS in recognition of the leading role the SARB plays in global policy debates in this area.
Low-impact
Anvari et al, 2022, A climate change modelling framework for financial stress testing in Southern Africa (working paper)
The implications of national and international carbon pricing policies for the South African Reserve Bank (working paper)
The SARB has published a series of short notes exploring the impacts of specific physical and transition risks.
BRICS 2023 climate data and technology report: Bridging Climate Data Gaps with Frontier Technology.
Carbon taxation in South Africa and the risks of carbon border adjustment mechanisms (Occasional Bulletin of Economic Notes).
Transition and systemic risk in the South African banking sector assessment and macroprudential options (working paper)
Monetary Policy
1 out of 50
High-impact
N/A
Medium-impact
N/A
Low-impact
The ESG South Africa pillar includes incorporating climate considerations into the SARB’s investment management framework. The SARB is in the process of investing €150mn in a green bond.
Financial Policy
11 out of 50
High-impact
N/A
Medium-impact
The SARB’s climate stress test of systemically important banks was initiated in March 2024, and is scheduled for completion in early 2025 (formal commitment).
Low-impact
South Africa’s Prudential Authority finalised a supervisory guideline on climate-related risk, and undertook 22 engagements with boards of directors and senior management of selected financial institutions.
G2-2024 – Guidance on Climate-related Governance and Risk Practices for Banks.
G1-2024 – Guidance Notice on Climate-related Governance and Risk Practices for Insurers.
G3-2024 – Guidance on Climate-related Disclosures for Banks.
G2-2024 – Guidance on Climate-related Disclosures for Insurers.
Integration of climate risks into SARB’s common scenario stress test of six systemically important banks.
Prudential communication to financial institutions on climate-related risks.
A smaller climate risk add-on was included in the macroprudential stress test of insurers in 2023/24.
Leading by Example
4 out of 20
High-impact
N/A
Medium-impact
N/A
Low-impact
A green finance taxonomy was developed following recommendations from a working group that includes the SARB.
The SARB has established a climate change skills hub.
A training session on the impact of climate change and stress testing was held in December 2023.
The SARB participated in different workstreams to develop technical and policy recommendations on how central banks and regulators can incorporate climate and biodiversity risks in the regulatory and supervisory frameworks.
Andreyev & Nelyubina, 2024, Energy transition scenarios in Russia: effects in macroeconomic general equilibrium model with rational expectations (working paper)
Penikas, 2023, Default correlation impact on the loan portfolio credit risk measurement for the “green” finance as an example (working paper)
Burova et al, 2023, Transmission to a low-carbon economy and its implications for financial stability in Russia (working paper)
Biodiversity Finance: Its Intersection with the Financial Sector, Green Webinar Series at Green Banking Academy, Interantional Finance Corporation, World Bank (speech)
Financial Stability Report 2023, in which environmental and sustainable considerations are included.
Financial Stability Report 2024, in which environmental and sustainable considerations are included.
Tendencies and Challenges in Sustainable Fiance (handbook)
Monetary Policy
2 out of 50
High-impact
N/A
Medium-impact
The Banco de México is considering expanding the exclusion criteria for investment in international reserves to environmental considerations (policy under discussion).
Low-impact
Banco de México issued Rules for Syndicate Auctions of ESG Government Assets.
Financial Policy
1 out of 50
High-impact
N/A
Medium-impact
N/A
Low-impact
The Banco de México’s sustainable finance committee created a group on ISSB draft standards to promote implementation of financial disclosure standards.
Leading by Example
9 out of 20
High-impact
N/A
Medium-impact
N/A
Low-impact
The Mexican Sustainable Taxonomy was developed by the Banco de México’s sustainable finance committee, of which Irene Espinosa is a member, and was published by the Secretary of Finance and Public Credit.
Banco de México is leading a financial education and capacity building program on ESG disclosures and climate risk analaysis.
The sustainable finance committe created the Repository Digital for Learning and Colaborating on Sustainable Finance.
Through the CNBV, the Treasury and Public Finance Secretary invited civil society to participate in a survey to contruct the strategy for the mobilisation of sustainable finance.
Financial Stability Report 2023, in which environmental and sustainable considerations are included.
Financial Stability Report 2024, in which environmental and sustainable considerations are included.
Banco de México has taken actions to reduce electricity consumption, water consumption, paper consumption and promote hybrid vehicles and recycling.
Creation of a sustainable finance committee, an umbrella organisation of Ministry of Finance, Banco de Mexico, and financial agencies which engages with the private sector and promotes green finance.
Educational resources provided for financial institutions on green international and national principles.
The Bank of Korea, the Financial Service Commission (FSC), and the Financial Supervisory Service (FSS) are members of the NGFS.
In the monetary policy report of December 2023, the Bank of Korea included an analysis of the Market Conditions and Implications of the Korea Emission Trading Scheme (K-ETS).
The Bank of Korea published Spillover Effects of Foreign Climate-related Physical Risks via Trade Channels: Evidence from Korea.
The Bank of Korea published The Impact of Tariffs and Non-Tariff Measures on Trade in Decarbonization Technology Products.
The Bank of Korea published Climate-related Transition Risks and Financial Stability.
Monetary Policy
8 out of 50
High-impact
N/A
Medium-impact
Green considerations incorporated into foreign exchage reserve management.
As of the end of 2023, the amount dedicated by the Bank of Korea to ESG related assets in the foreign exchange reserves account increased 117% from the levels of 2021, reaching a total of US$19.61bn, ofwhich 44.67% is invested ESG bonds and 55.33% in ESG equities. From 2024, the Bank of Korea established a policy for this account to explicitly include ESG considerations for its management. Additionally, since 2022, a negative screening strategy has applied to foreign exchange reserves management that restricts the investment in companies that belong to coal and fossil fuel industry.
The FSC plans to invest a total amount of 9tn won in the climate technology sector through its various funds (formal commitment).
Low-impact
N/A
Financial Policy
2 out of 50
High-impact
N/A
Medium-impact
N/A
Low-impact
The FSS introduced guidelines on the management of climate risks in the financial sector.
The FSC chair met with banking sector firms to discuss measures to boost climate finance and facilitate the low-carbon transition.
Leading by Example
1 out of 20
High-impact
N/A
Medium-impact
N/A
Low-impact
The FSS signed a memorandum of understanding to develop an ESG curriculum with financial holding companies and hold an international conference on the topic.
The Federal Reserve and Office of the Comptroller of the Currency are members of the NGFS.
Brunetti et al, 2022, Climate-related Financial Stability Risks for the United States: Methods and Applications (working paper)
Stiroh, 2022, Climate Change and Double Materiality in a Micro- and Macroprudential Context (working paper)
Pankratz & Schiller, 2022, Climate change and adaptation in global supply-chain networks (working paper)
Climate Change and the Role of Regulatory Capital: A Stylized Framework for Policy Assessment
Beltran et al, 2023, What are large global banks doing about climate change? (discussion paper)
A New Measure of Climate Transition Risk Based on Distance to a Global Emission Factor Frontier
Engagement in global insurance regulatory or supervisory forums in 2022
Monetary Policy
0 out of 50
High-impact
N/A
Medium-impact
N/A
Low-impact
N/A
Financial Policy
9 out of 50
High-impact
N/A
Medium-impact
The SEC has adopted rules requiring public companies to report their greenhouse gas emissions and disclose their climate-related risks, as well as how they plan to transition to a low-carbon economy. However, the policy has been weakened in response to corporate lobbying and continues to face legal challenges (formal commitment).
Principles for climate-related financial risk management for large financial institutions (those with US$100bn or more in total assets).
Creation of a supervision climate committee.
Creation of a climate-related financial risk committee.
Creation and launch of the Climate Data and Analytics Hub pilot.
Establishment of the financial stability climate committee.
Consulation on voluntary principles for managing climate-related financial risk management.
Low-impact
N/A
Leading by Example
1 out of 20
High-impact
N/A
Medium-impact
N/A
Low-impact
Pilot climate scenario analysis exercise implemented.
The Central Bank of the Republic of Turkey and Turkey’s Banking Regulation and Supervision Agency (BRSA) are members of the NGFS.
The BRSA is a member of the Sustainable Banking and Finance Network (SBFN).
Monetary Policy
0 out of 50
High-impact
N/A
Medium-impact
N/A
Low-impact
N/A
Financial Policy
5 out of 50
High-impact
N/A
Medium-impact
Under Action 1.3.4, infrastructure for stress testing and scenario analysis will be established within the BRSA (formal commitment).
Low-impact
Guidelines on loan origination and monitoring processes were issued by the BRSA to set expectations for banks on development of policies on climate risks and environmentally sustainable lending.
The BRSA raised loan-to-value ratio from 80% to 90% for housing with class A energy performance certificate and 85% for housing with class B (this measure was fully implemented, but effectively ended when all LTV ratios were raised in response to Covid).
Leading by Example
3 out of 20
High-impact
N/A
Medium-impact
N/A
Low-impact
The BRSA has created a sustainable bank working group.
The Central Bank of Turkey established a green economy and climate change department.
A workshop called Addressing Climate Change Data Needs: The Global Debate and Central Banks’ Contribution was hosted by the Central Bank of Turkey, and was jointly organized by the Irving Fisher Committee on Central Bank Statistics with the support of the Banque de France and the Deutsche Bundesbank.
France
Germany
Italy
European Union
Brazil
China
United Kingdom
Japan
Indonesia
India
Australia
South Africa
Canada
Russia
Mexico
Republic of Korea
United States
Turkey
Argentina
Saudi Arabia