International engagement and initiatives

Overview

The financial and economic consequences of climate change are not solely domestic concerns. We therefore play an active role in supporting a co-ordinated international approach to climate change - for example, through our work with other central banks and financial supervisors, playing prominent roles in international fora (such as the G7 and G20), and by working with the Government to deliver on its COP26 agenda (held in November 2021). Alongside counterparts from His Majesty’s Treasury, we represent the UK in the G20 Sustainable Finance Working Group (SFWG), the G20 Framework Working Group (FWG) and the G7 Climate Change Mitigation Working Group (CCMWG).

We also engage in the climate-related workstreams of standard-setters and international bodies. For example, we are contributors to the climate-related work of the Basel Committee on Banking Supervision (BCBS) and the Financial Stability Board (FSB).

We are also co-founders of the Sustainable Insurance Forum (SIF). SIF is a global network of insurance supervisors and regulators, who are working together on sustainability challenges facing the insurance sector, including climate change.

The Bank also actively contributes to climate work at the IAIS, including to the Application Paper and updated Insurance Core Principles (ICPs) on the supervision of climate risks in the insurance sector. We also participate in the annual global monitoring exercise and the publication of the Global Insurance Market Report.

Central Banks and Supervisors Network for Greening the Financial System (NGFS)

We are a founding member of the Central Banks and Supervisors Network for Greening the Financial System (NGFS) and sit on the steering committee. Through the NGFS, we aim share our own experience, learn from others, and promote consistent and effective responses to climate-related financial risks by central banks and supervisors across the world.

Supporting enhanced climate disclosure

To allow markets to better assess, price and manage climate-related financial risks, the Financial Stability Board (FSB), at the request of G20 leaders, established the industry-led Task Force on Climate-related Financial Disclosures (TCFD) in 2015.

We use this framework for our own annual climate-related financial disclosure, which was first published as part of our annual reporting for the financial year 2019/20, and sets out our approach to managing climate-related financial risks.

We are an official supporter of the TCFD recommendations. In November 2020, we, alongside others in the joint UK Government-Regulator TCFD Taskforce, set out a roadmap towards mandatory TCFD-aligned climate disclosures across the UK economy by 2025.

In October 2021, the UK Government set out more information on their proposed Sustainability Disclosure Requirements (SDR) in their Sustainable Finance Roadmap and the 2023 Green Finance Strategy sets out further detail on the timeline. The SDR will provide an economy-wide framework to support the greening of the UK financial system and alignment with the UK’s net-zero commitment. It will cover UK corporates, investment products and investment portfolios, and will streamline the UK’s existing disclosure requirements (e.g. mandatory TCFD-aligned climate disclosures) with new requirements.

At an international level, the Bank supports the International Sustainability Standards Board’s (ISSB) global climate disclosure standards, which were issued on 26 June 2023. The standards (S1 and S2) build on the TCFD framework and recommendations to set a high-quality, comprehensive global baseline for climate-related financial disclosure focused on the needs of investors and the financial markets.

We continue to actively engage with the ISSB to support their work on climate disclosure, including its interoperability with other climate disclosure standards to promote global consistency.

Supporting increased technical co-operation and assistance

We support the work of other central banks and financial regulators on climate change, in part through our Centre for Central Banking Studies (CCBS).

For decades, we have provided international central banking technical co-operation and assistance to equip central bankers and financial regulators with the skills and knowledge they need to tackle the challenges they face. In recent years, this has included assistance on climate change.

In partnership with the UK’s Foreign, Commonwealth and Development Office (FCDO), we are hosting a series of workshops on climate change in 2021 and 2022. These are aimed at central bankers and financial regulators who handle climate related issues in their institutions. In September 2021, we held a global workshop on climate-scenario analysis and stress testing, with over 330 central bankers and supervisors spanning 65 countries in attendance. Find out more about our workshop programme.

We support the Central Banks’ and Supervisors’ Climate Training Alliance (CTA), established by the Bank for International Settlements (BIS), International Association of Insurance Supervisors (IAIS), NGFS and SIF. The CTA aims to support technical cooperation and assistance on climate-related financial risks among central banks and financial supervisors.