Major North American Banks Collaborate to Develop Climate Risk Management Standards
A group of 19 major North American banks, including Bank of America, Wells Fargo and Royal Bank of Canada announced the launch of the RMA Climate Risk Consortium, aimed at developing climate risk management standards for banks to integrate throughout their operations. The coalition was established under the Risk Management Association (RMA), a not-for-profit professional association focused on advancing sound risk management principles in the financial services industry.
Nancy Foster, RMA President and CEO, said:
“For over a century, RMA has focused on bringing the industry together to overcome complex problems and difficult times. With the world facing the existential challenge of climate change, it’s more important than ever that banks work together on this issue. With their crucial role in the health of economies and communities, banks will help drive the environmental transition to a greener economy, and the RMA Climate Risk Consortium is leading the charge on this defining issue of our time.”
The new consortium aims to advance practices for member banks and the broader industry by assessing current efforts and developing consistent taxonomy, frameworks and standards for climate risk management. In addition, it is engaging with regulators and policy makers to help inform ongoing policy considerations specific to a changing climate.
Mary Obasi, Global Climate Risk Executive, Bank of America, and Chair of the Consortium, said:
“As a financial institution, it is critical that we manage and mitigate risk related to climate change. This includes physical risks, transition risks—and opportunities—that will impact communities, the markets, consumer preferences, and regulations. In the same way that banks played a key role in providing funding to businesses and communities through the pandemic, financial institutions will continue to be an essential part of—and play a pivotal role in—the transition to a net zero, more sustainable economy.”
The full list of members includes Bank of America, Fifth Third Bank, Huntington National Bank, KeyBank, M&T Bank Corp, MUFG Union Bank, National Bank of Canada, Regions Bank, Royal Bank of Canada Silicon Valley Bank, and its parent, SVB Financial Group, Truist, U.S. Bank and Wells Fargo.