The Basel Committee on Banking Supervision is looking to strength regulation on climate-related financial risks.

The committee, with 45 members from 28 jurisdictions, tasked with setting standards for bank capital, liquidity and funding, is seeking feedback on a paper it has issued on how climate scenario analysis (CSA) can be practically used and measures adopted.

In 2022, the principles for the effective management and supervision of climate-related financial risks encouraged banks to use CSA to assess the resilience of their business models and strategies to a range of climate-related pathways and determine the impact on their overall risk profile.

However, differences in the scope, features and approaches across jurisdictions has left the Committee seeking to strengthen the regulation, supervision and practices of banks worldwide.

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