Assessing Climate Risk Impact on Financial Regulation across Asia-Pacific Region
In a recent webinar moderated by Junice Yeo, the Executive Director of a leading website, key issues surrounding climate-related financial regulations and their implementation were discussed. Aziz Durrani, Team Lead and Senior TA Specialist at the ASEAN+3 Macroeconomic Research Office (AMRO), and Suraya Sani, Deputy Director of the Sustainability Unit at Bank Negara Malaysia, were among the speakers, sharing their insights on the topic.
The webinar focused on the UNEP FI report titled "Climate-related risks in financial regulation and supervision in APAC: A policy landscape analysis." The report examines how jurisdictions across the Asia-Pacific (APAC) region are integrating climate-related risks into their financial regulatory frameworks.
According to the report, APAC regulators are increasingly integrating climate-related risks into prudential frameworks, focusing on both micro- and macroprudential regulation. This integration aims to enhance financial system stability and resilience against climate change impacts. However, the report also notes that central banks in the region have diverse mandates regarding climate change, with some countries explicitly including sustainability in their mandates, while others reference broader sustainability objectives implicitly.
The webinar also highlighted recent developments in climate-related financial regulations in APAC. The region is witnessing a diverse range of regulatory responses to address climate change risks. These efforts aim to support more resilient financial systems and drive capital allocation towards sustainable activities, potentially accelerating the transition to a low-carbon economy.
UNEP FI's Regulatory Implementation Support Programme was also discussed. This programme is designed to help stakeholders understand and comply with sustainable finance regulations. The programme offers both public and UNEP FI members-only webinars on timely policy and regulatory topics.
The integration of climate-related risks into financial regulation in APAC is set to influence lending and investment patterns, potentially reshaping economic activities across various industries. This could lead to increased resilience in financial systems and support a more sustainable economic transition.
Adam Ng, a member of the Finance Practice Leadership Team at WWF, was also present at the webinar, providing additional perspectives on the topic. The webinar was part of UNEP FI's Regulatory Implementation Support Programme and aimed to facilitate knowledge sharing and implementation across the region.
- The discussion in the webinar centered around UNEP FI's report, "Climate-related risks in financial regulation and supervision in APAC," which explores how Asia-Pacific (APAC) regulators integrate carbon-impacting risks into their financial regulations.
- According to the report, APAC regulators are focusing on micro- and macroprudential regulation to enhance sustainability in the banking-and-insurance sector, aiming to make financial systems more resilient against climate change impacts.
- Another key point from the report is the diverse mandates that central banks have regarding climate change and sustainability, with some countries explicitly including these elements in their objectives, while others do so implicitly.
- The webinar underlined the progress of climate-related financial regulations in APAC, where industry players like banks and insurers are adopting environmental-science principles to allocate capital towards sustainable activities, ultimately helping move towards a low-carbon economy.
