On 29 June 2020, the Climate Financial Risk Forum (CFRF), co-chaired by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) in the UK, published the ‘Guide to Climate-Related Financial Risk Management’. The guide highlights the importance and urgency for financial institutions to facilitate an accelerated and shared approach to understanding and mitigating climate-related risks, and appropriately responding to consumers’ changing preferences. The guide suggests how firms can plan for the impact of climate policies over different time horizons and assess their exposure to climate-related financial risks so that they can adapt their businesses in response.

The full guide contains four industry-produced chapters – covering (1) Risk Management, (2) Scenario Analysis (3) Disclosures, and (4) Innovation – as well as a summary co-produced by the FCA and PRA.