In response to the major threat posed by the climate emergency to financial stability, central banks and supervisory authorities are increasingly focussing on incorporating climate risk criteria when assessing and stress testing financial institutions. In addition, several initiatives such as the UNEPFI Principles for Responsible Banking and the Task Force on Climate related Financial Disclosures (TCFD) are gaining momentum, encouraging the scaling up of green financing.
At Mazars, we can support financial institutions in responding to regulatory expectations, adhering to sustainability principles, and more broadly, navigating the complex risks and make the most of opportunities emerging from sustainability and climate change.
Our sustainable finance specialists advise financial services firms on the integration of ESG criteria into their business or investment decisions, for both the benefit of their future sustainability, and for the broader public interest.
Our sustainable finance services include:
IMPLEMENTATION OF VOLUNTARY SUSTAINABILITY FRAMEWORKS
At Mazars, we have developed a toolkit for the implementation of the various voluntary frameworks launched to scale up the contribution of the financial industry to meeting the UN Sustainable Development Goals and the Paris Agreement targets. Examples of frameworks include the UNEP FI Principles for Responsible Banking (PRB) and the Green Investment Principles for China’s Belt and Road Initiative (GIP).
IMPLEMENTATION OF REGULATORY REQUIREMENTS AROUND CLIMATE CHANGE AND ESG
Across the world, financial institutions and investors should expect ever-tougher regulatory action on climate change and ESG criteria. In the UK, the Prudential Regulation Authority published its expectations for climate risk management in April 2019, and the Bank of England plans to launch climate stress tests in the UK in the second half of 2020 and publish the results in 2021. The European Commission, the EBA and other national regulators are also active in promoting better understanding and management of these risks.
To support financial institutions engaging in the transition and responding to regulatory requirements, our services cover:
Sustainable and responsible governance
- Align your strategy with sustainable development goals and best practices
- Integrate ESG factors into decision-making process and performance assessment
- Promote sustainable and climate change culture and expertise
Climate and ESG risk management
- Include climate change considerations in risk management frameworks
- Adapt risk policies for the identification, measurement and mitigation of climate risks (credit, market and operational)
- Support in scenario analysis / stress tests for transition and physical risks (short term and long term scenarios)
Climate and ESG disclosure and reporting
- Incorporate climate change and ESG metrics in reporting
- Align public disclosures with regulatory standards, such as the TCFD framework
- Incorporate climate change in Pillar 3 disclosures