By Nigina Mirbabaeva
Highlights
- TCFD report discloses the EBRD's mainstreaming of climate-related assessment into investment decisions, portfolio management, overall risk management and disclosure
- Bank embarked on a journey to calculate financed emissions and assess the carbon footprint of its investments
- EBRD dedicated to continuous advancement on climate finance, including opportunities from low-carbon transition, and to increasing climate resilience; all new investments and activities fully Paris-aligned from 1 January 2023
The EBRD has published its fourth annual report based on the voluntary reporting framework of the Task Force on Climate-Related Financial Disclosures (TCFD).
"We are pleased to share our progress on identifying and disclosing climate-related risks and considerations in the Bank's activities with our stakeholders," said Annemarie Straathof, EBRD Vice-President, Risk and Compliance. "As a leader in the delivery of climate finance, the EBRD recognises the imperative of integrating climate considerations into investment decisions. The report reaffirms our commitment to further strengthening our assessment, management and disclosure of climate-related risks."
The report outlines the progress made on identifying, assessing and dealing with climate-related financial risks and opportunities in the Bank's investment decisions and overall portfolio management. It also highlights the Bank's planned enhancements to its climate risk disclosure and reporting practices.
It underscores how, in 2022, the EBRD fulfilled its pledge to ensure that from 1 January 2023, it would align all of its activities with the mitigation and adaptation goals of the Paris Agreement on climate change.
The report includes details of the Bank's climate risk screening and assessments, including its extension of the process to sovereign and equity investments. It showcases the EBRD's new systematic climate risk-screening methodology for partner financial institutions (PFIs), part of the Bank's goal to help align PFIs' financial flows with the Paris Agreement throughout its investee economies.
It presents results from the Bank's carbon transition stress test of its largest corporate and sub-sovereign clients in high-emitting sectors under a more robust and systemic approach.
The report also discloses the Bank's own carbon footprint and preliminary calculations of financed emissions for part of its portfolio.
The TCFD was created in 2015 to foster reporting on the financial impacts of climate change on organisations and the global response to limit that change. The framework is meant to improve internal risk management and identification of opportunities, and to provide consistent disclosure of climate-related risk to capital markets and other stakeholders.
The EBRD is a leader in climate finance and plays a prominent role in promoting the low-carbon transition and climate resilience of more than 30 economies across its regions. In 2022, half of its record 13 billion in investments were dedicated to green projects.
The Bank was also the first multilateral development bank to run a pilot on nature-related risks and will continue to explore the integration of nature-related risk assessment into its processes.
