Climate change and our impact on nature are the biggest challenges of our times. The latest Intergovernmental Panel on Climate Change (IPCC) report was called a code red for humanity. Recognizing the emergency and the threat to financial stability, more than 100 supervisors and regulators, including the European Central Bank (ECB) and the European Banking Authority (EBA) gathered in the Network for the Greening of the Financial System (NGFS) to promote embedding climate & environmental factors into banks' risk management practices and support capacity building. A comprehensive set of EU climate & environmental regulatory guidelines and supervisory expectations were issued in 2019 and 2020. Since then, the depth and speed of ECB climate-related reviews has intensified through detailed surveys, top-down and bottom-up pilot climate stress testing. The direction is clear: climate will soon result in Pillar 2 add-ons and will be integrated in Pillar 1. Banks need to embed climate change in their risk management framework and practices to avoid additional capital charges.
The objective of this three half-day online course is to give the participants a deeper understanding of how climate-related and environmental risks should be embedded into bank’s risk management framework. Subject matter experts will focus on the European Central Bank’s (ECB) “Guide on Climate-related and Environmental Risks” and the European Banking Authority’s (EBA) recommendations on risk management and supervision.
Participants will also learn about best practices to integrate climate risk into governance, strategy, risk management and disclosure. The course also covers climate scenario analysis and stress testing with concrete examples of the analysis performed by the ECB. Different approaches used to assess physical risk and transition risk by banks will also be presented, including data needs.
All the sessions include practical case studies and examples to make the course interactive.
The course is intended particularly for:
- Risk managers
- Business units: CIB, Retail banking, Specialised Lending
- Corporate Social Responsibility
- Finance teams, particularly those in charge of funding, investors relations, reporting
- Regulatory reporting teams