Climate change is a systemic risk that threatens to inflict heavy costs for the financial sector if no action is taken. Banks and investors, with the right frameworks and guiding principles, have the unique potential to mobilise capital for positive climate action.
Challenges and Trends
As the region’s financial centres position themselves as green finance hubs, a range of opportunities are emerging to incentivise green bonds, green loans and green investments. At the same time, regulatory authorities throughout the region are putting reporting standards in place which will require lenders, investors and insurers to take full account of climate risk in their activities. Campaigning pressure against continued financial support for the fossil fuel sector is now becoming a concern echoed by investors and some regulators.