Legal & Regulatory News

FSB publish report on implications of climate change for financial stability

23 November 2020

The Financial Stability Board (FSB) has published a report that examines the potential implications of climate change for financial stability. The report analyses how climate-related risks might be transmitted across, and amplified by, the financial system, including across borders.

The report investigates:

  • the ways in which physical and transition risks from climate change can affect financial stability, as well as the potential for these to interact;
  • how climate-related risks might be transmitted across, and amplified by, the financial system including via its interaction with the real economy;
  • the degree to which climate-related risks might be transmitted across borders, including through the exposures of financial institutions; and
  • the actions by market participants and regulators that might go some way towards mitigating climate-related risks to financial stability.

The report also sets out next steps for the FSB’s work in this area, which it aims to complete by October 2021.

Click here to access the report.