Legal & Regulatory News

Bank of England speech on the move to net zero and the climate scenario analysis

The Bank of England has published a speech by Sarah Breeden, Executive Director, UK Deposit Takers Supervision, discussing how financial services firms in the UK can act as stewards in the move to a ‘net zero’ economy.

The speech highlights that financial firms need to run climate scenarios as part of business as usual risk management and embed climate risk management within day-to-day decision-making. The speech also discusses insights from the Network for Greening the Financial System (NGFS) climate scenarios which firms are urged to consider, and the challenges in applying them.

The NGFS will release an update to the climate scenarios in June 2021, to include bespoke scenarios, detailed macroeconomic modelling and a new online portal that can be used to explore physical risks.

Click here to access the speech.

Click here to read further about the climate scenario analysis.