At the Paris ‘One Planet Summit in December 2017, 8 central banks and supervisors established a Network for Greening the Financial System, with a purpose to help strengthen the global response required to meet the goals of the Paris Agreement and to enhance the role of the financial system to manage risks and to mobilize capital for green and low-carbon investments in the broad context of environmentally sustainable development.

    This report from the Bank of England looks at the financial risks relating to climate change that impact Prudential Regulation Authority (PRA) regulated banks, building societies and designated investment firms. It also assesses how banks are responding to and managing the financial risks from climate change and helps banks understand the PRA’s supervisory approach to the financial risks from climate change.

    HSBC is actively engaging to further the agenda on these factors, and has published ‘Managing financial system stability and climate change – A preliminary guide’ to set out how banks can apply a climate lens to existing risk management and scenario analysis processes and practices in order to support financial stability across the economic system.