Climate risks in changing economic environment: consultation paper
The Bank of Russia proposes to discuss a new configuration of climate risks for the Russian economy, requirements for disclosure of information on sustainable development, and approaches to climate risk management in financial institutions.
The Russian economy is vulnerable to climate risks due to high carbon intensity and geographic factors. Materialisation of such risks may adversely affect the activities of businesses and the financial sector. The Bank of Russia considers managing these risks and limiting their impact on the financial sector to be one of the most important tasks in maintaining financial stability.
The report explores the potential for climate risks to be taken into account in banking regulation. In particular, it proposes to clarify the approaches to assessing credit risks of borrowers and the requirements for the risk management system in banks. It will examine the potential application of measures to promote lending for green and climate adaptation projects and the disclosure of information on borrowers’ exposure to climate risks.
The climate risk analysis by financial institutions and stress testing are hindered by a lack of data. Over the next few years, Russian issuers will need to strike a balance between minimising sanctions risks and disclosing the necessary information about their exposure to climate risks.
Please send your answers to the questions raised in this consultation paper as well as your comments and suggestions before 10 February 2023.