NGFS Publishes Guide on Climate Disclosures for Central Banks
The Network for Greening the Financial System (NGFS) published the guide on climate-related disclosures for central banks. As a starting point, the guide takes the recommendations of the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD). The guide highlights the steps central banks could take to prepare their own climate-related disclosures. It explains how central banks can disclose information in line with the TCFD recommendations. It aims to complement the existing climate-related disclosure standards and regulation. The guide is published as a number of NGFS members are working toward TCFD-aligned disclosure of all or of parts of their activities.
The guide is structured around the following three chapters:
- Governance. Central banks are recommended to disclose their high-level approach to climate-related risks and opportunities. The guide also recommends that central banks disclose how governance structures for monetary policy, asset management, financial stability, and internal operations
encompass climate-related risks and opportunities. - Strategy. The guide recommends that central banks disclose their strategies for identifying and assessing the inward and outward impact of climate-related risks. . As part of this disclosure, central banks should describe material risks and state the time horizon they consider most relevant for managing these risks. Where appropriate, central banks might disclose any adaptation of areas and functions, as well as changes to operational frameworks, embedded in the strategies. Finally, central banks are recommended to disclose their strategies for capacity building around climate-related risks and opportunities.
- Risk management. The guide recommends to disclose the current state of climate-related risk management, including integration with non-climate-related risk management. Central banks could start by using backward-looking methodologies to identify, assess, and disclose their climate-related exposures associated with credit facilities and investment portfolios. The guide recommends disclosing the central banks’ use of data, the sources of those data, their incorporation into risk analysis, as well as any relevant limitations of the data. Central banks are recommended to describe how climate-related risks are integrated into their existing risk management frameworks. Central banks are also recommended to make disclosures on target setting.
The fourth pillar of the TCFD recommendations, metrics, and targets serves to inform and support the organization’s governance, strategy, and risk management processes and is approached in this first guide through the cross-cutting perspective. Climate-related disclosure by central banks is still in its infancy. Looking ahead, NGFS will continue to serve as a forum for central banks to share their experiences and discuss challenges and possible ways forward. As part of this work, it would be important to have further guidance on metrics for disclosure on climate-related governance structures and strategy. The same can be said for risks associated with credit operations and counterparty collateral. Furthermore, future work could include additional guidance on the preparation of disclosures on central banks’ internal operations as well as guidance on environmental disclosures. In the coming years, climate-related disclosure by central banks is expected to go mainstream. NGFS will continue to contribute to this progress and develop new guidance for the management and disclosure of climate-related and environmental risks and opportunities.
Related Links
Keywords: International, Banking, Climate Change Risk, ESG, Disclosures, TCFD, NGFS
Featured Experts

Michael Denton, PhD, PE
Dr. Denton provides industry leadership in the quantification of sustainability issues, climate risk, trade credit and emerging lending risks. His deep foundations in market and credit risk provide critical perspectives on how climate/sustainability risks can be measured, communicated and used to drive commercial opportunities, policy, strategy, and compliance. He supports corporate clients and financial institutions in leveraging Moody’s tools and capabilities to improve decision-making and compliance capabilities, with particular focus on the energy, agriculture and physical commodities industries.
Previous Article
HM Treasury Issues Update on Review of Securitization RegulationRelated Articles
EBA Clarifies Use of COVID-19-Impacted Data for IRB Credit Risk Models
The European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19-impacted data for banks using the internal ratings based (IRB) credit risk models.
EP Reaches Agreement on Corporate Sustainability Reporting Directive
The European Council and the European Parliament (EP) reached a provisional political agreement on the Corporate Sustainability Reporting Directive (CSRD).
PRA Consults on Model Risk Management Principles for Banks
The Prudential Regulation Authority (PRA) launched a consultation (CP6/22) that sets out proposal for a new Supervisory Statement on expectations for management of model risk by banks.
EC Regulation Amends Standards for Calculating Credit Risk Adjustments
The European Commission (EC) published the Delegated Regulation 2022/954, which amends regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.
BIS Hub Updates Work Program for 2022, Announces New Projects
The Bank for International Settlements (BIS) Innovation Hub updated its work program, announcing a set of projects across various centers.
EIOPA Issues Cyber Underwriting Proposal, Statement on Open Insurance
The European Insurance and Occupational Pensions Authority (EIOPA) published two consultation papers—one on the supervisory statement on exclusions related to systemic events and the other on the supervisory statement on the management of non-affirmative cyber exposures.
US Senate Members Seek Details on SEC Proposed Climate Disclosure Rule
Certain members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs issued a letter to the Securities and Exchange Commission (SEC)
EIOPA Consults on Review of Securitization Framework in Solvency II
The European Insurance and Occupational Pensions Authority (EIOPA) published a consultation paper on the advice on the review of the securitization prudential framework in Solvency II.
UK Authorities Issue Regulatory and Reporting Updates for Banks
The Prudential Regulation Authority (PRA) issued a statement on PRA buffer adjustment while the Bank of England (BoE) published a notice on the statistical reporting requirements for banks.
BCBS Issues Climate Risk Principles while HKMA Expresses Its Support
The Basel Committee on Banking Supervision (BCBS) issued principles for the effective management and supervision of climate-related financial risks.