Guidelines On Climate Risk, Sustainable Finance : RBI
The Reserve Bank of India released a discussion paper called Climate Risk and Sustainable Finance.
- RBI says that climate change has the full potential to transform into climate-related financial risks. The guidelines are not yet released.
- RBI will release it in a phased manner.
- The guidelines will have all instructions related to climate risks.
- The discussion paper of RBI analyses an issue from different angles and provides solutions and guidelines to solve the problem.
- Based on the Climate Risk and Sustainable Finance discussion paper, the bank is to release guidelines on accepting green deposits; a framework to deal with climate-related financial risks.
- The RBI discussion paper defines the term as “Potential risk arising from climate change”.
- The climate-related financial risks occur in two main forms i.e physical risks and transition risks.