Reflecting significant pushback from both the American Bankers Association and U.S. banking agencies, the Basel Committee last week issued a framework for voluntary disclosure of climate-related financial risks for large international banks.
First proposed in 2023, the framework offers prescriptive detail of historical and targeted emissions metrics and commercial lending exposures by industrial sector and geographic physical risk evaluation. Among the changes in the final framework are an emphasis on voluntary compliance, a focus on materiality and risk alignment, and the omission of “facilitated emissions” metrics, which apply to capital markets activities.
“The committee will monitor relevant developments, including implementation of other reporting frameworks and disclosure practices by internationally active banks in member jurisdictions, and consider whether any revisions to the framework would be warranted in [the] future,” the committee said in a statement.
