FCA Sets Out Priorities on Climate Change and Green Finance
FCA published feedback statement (FS19/6) on its October 2018 discussion paper (DP18/8) on climate change and green finance. Through the discussion paper, FCA sought views on the potential FCA action on climate change and green finance, in line with its strategic objective of ensuring that relevant financial markets function well. The statement identifies a number of priorities that will provide a foundation for the future work of FCA in this area. These priorities include issuers’ climate change disclosures, regulated firms’ integration of climate change risk and opportunities into their decision-making, and consumers’ access to green financial products and services.
The feedback statement applies to policy makers and regulatory bodies, regulated firms, issuers, investors, and advisers to issuers and investors, industry groups/trade bodies, industry experts and commentators, consumer groups and individual consumers, charities, and academics and think tanks. The statement sets out the key actions FCA will take:
- Consult in 2020 on new rules to improve climate-related disclosures by certain firms and clarify existing obligations
- Finalize rule changes requiring Independent Governance Committees to oversee and report on firms’ environmental, social, and governance (ESG) and stewardship policies
- Publish a feedback statement in response to a joint Discussion paper with the Financial Reporting Council on Stewardship, setting out actions to address the most significant barriers to effective stewardship
- Clarify expectations about consumer access to green financial products and services and take appropriate action to prevent consumers from being misled
- Continue to contribute to several collaborative initiatives, including the Government-led cross-regulator taskforce on disclosures and the Climate Financial Risk Forum (CFRF), which was established with PRA earlier this year.
FCA had received 73 responses to the discussion paper from a range of stakeholders, including regulated firms, trade bodies, and think tanks. The feedback has been summarized under five key themes: climate-related disclosures by securities issuers; climate-related disclosures by regulated firms; common metrics and standards on sustainability; stakeholder concerns, commercial priorities, and barriers to growth; and industry engagement.
Related Links
Keywords: Europe, UK, Banking, Insurance, Securities, Climate Change, Green Finance, Climate-Related Disclosures, FCA
Previous Article
ACPR Issues the COREP Taxonomy Version 2.8.1.1 Under CRRRelated Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
