PRA Publishes Summary of Third Meeting of Climate Financial Risk Forum
The Joint Climate Risk Forum of FCA and PRA held its third meeting in November 2019. At the meeting, the working group chairs presented the draft practical guidance, recommendations, and progress to date. The members discussed the outputs, noting the importance of how to strike the right balance around the granularity or "prescriptiveness" of the recommendations and how to consider challenges related to data integrity. The members also discussed the form of the outputs and the timeline for publishing them, with focus on getting wider industry input on the draft guidance and recommendations in early 2020. Members agreed that there would be an industry engagement event in January and the Forum will aim to publish the final version of these outputs in Spring 2020.
The forum agreed to undertake a second year of work and discussed initial ideas for what future work it may undertake beyond Spring 2020. The next meeting will take place in the first quarter of 2020 and will focus on finalizing the outputs for publication and determining the next steps.
The objective of CFRF is to build capacity and share best practices across financial regulators and industry to advance financial-sector responses to the financial risks from climate change. It brings together senior representatives from across the financial sector, including banks, insurers, and asset managers. The forum is chaired by Sarah Breeden (Executive Director of International Banks Supervision, PRA) and Christopher Woolard (Executive Director of Strategy and Competition, FCA). Since its inception in March 2019, CFRF has set up four technical working groups on disclosure, scenario analysis, risk management, and innovation. Each working group is chaired by a CFRF member and supported by an external secretariat. Each working group has planned the approach it proposes to take and the outputs it will deliver in terms of practical guidance and best-practice material.
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Keywords: Europe, UK, Banking, Insurance, Securities, Climate Change Risk, Climate Financial Risk Forum, ESG, CFRF, FCA, PRA
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