We will act to encourage an earlier, and therefore more orderly, transition to a carbon-neutral economy. We will lead by example to help mainstream a culture of climate risk management throughout the economy.
To support an orderly transition to a carbon-neutral economy, we will
- Conduct a climate stress test for financial institutions in 2021, to help mainstream climate risk management. To facilitate scenario design, the Bank will publish a discussion paper in the autumn of 2019 and work with industry and other authorities through the Climate Financial Risk Forum and the Network for Greening the Financial System.
- Continue to encourage TCFD disclosures by UK financial institutions and companies to provide better information on climate-related risks and opportunities. We expect by 2022 that all listed companies and large asset owners will be disclosing this information.
- Lead by example by increasing transparency over the Bank’s exposures to climate risks and approach to managing them, and adopt best practice to reduce its own carbon footprint.
Our responseLearn more about our work to test the UK financial system’s resilience to the risks from climate change:
- Governor Carney announces our new climate stress test – the 2021 biennial exploratory scenario (BES) – in his Mansion House speech
- The stress test is further outlined in the July 2019 Financial Stability Report
- Insurance stress test 2019: Letter sent to the largest regulated life and general insurers
Find out how the risks from climate change affect the Bank’s core objectives: