The Financial Stability Board is in the process of building a “roadmap” to coordinate work being done on climate-related financial risks, FSB Chair and Federal Reserve Vice Chairman for Supervision Randal Quarles wrote in a letter to G-20 finance ministers today. The FSB’s roadmap will identify where climate-related work on financial risk is underway, what work is needed and how the different work streams can fit together.
Emphasizing the importance of international coordination on this effort, Quarles said that the work FSB can do to “sharpen focus, amplify important messages, and identify areas where agreement on the way forward has been reached—or needs to be reached—will be key in promoting quick progress.” Quarles added that the FSB will join the Network for Greening the Financial System—a group of central banks of which the Fed is a member—as an observer.
Turning to the COVID-19 pandemic, Quarles said that “speedy, sizable, and sweeping policy response has been key to limiting the economic fallout” but cautioned that “early withdrawal of support measures could pose risks to financial stability.”
