From Yahoo Finance: 2025-05-12 16:44:00

Global banking regulators have agreed to intensify efforts to understand financial risks posed by climate change, despite pushback from the United States. Policy makers on both sides of the Atlantic are debating embedding climate change into central bank policy, with Europe prioritizing climate risks while the U.S. scales back efforts.

The oversight body of the Basel Committee on Banking Supervision will publish a voluntary disclosure framework on climate-related financial risks. While the committee does not have enforcement powers, its international standards strongly influence national rulemaking. Analysts note that the committee’s approach aligns more with European regulators integrating climate risks into banking expectations.

In the U.S., the Federal Reserve has taken initial steps to address climate change, but Chair Jerome Powell maintains the Fed’s role is limited. President Donald Trump and other Republicans have pushed back against policies related to environmental, social, and governance issues, leading to the Fed’s withdrawal from the Network of Central Banks and Supervisors for Greening the Financial System in January.

The U.S. Treasury Department’s Office of the Comptroller of the Currency withdrew from a set of climate principles for large U.S. banks in March, citing the framework as “overly burdensome and duplicative”. This move reflects the broader trend of U.S. reluctance to prioritize climate-related financial risks compared to European counterparts.



Read more at Yahoo Finance: Global banking regulators agree to prioritise climate risk work