Investment data and research provider MSCI announced today the launch of a new solution aimed at helping banks meet the European Banking Authority’s (EBA) upcoming ESG and climate-related risk disclosure requirements.
Earlier this year the EBA released a set of standards for “Pillar 3” disclosures on ESG risks, providing technical details required for banks to report on issues including how climate change may exacerbate balance sheet risks, how they are mitigating those risks, and exposure to taxonomy-aligned activities, aimed at enabling stakeholders to assess banks’ ESG related risks and sustainable finance strategy.
The initial Pillar 3 ESG disclosure requirements come into effect this year, with reporting on some aspects beginning in 2023, and other phased in over time.
According to MSCI, the new solution supports the granular reporting requirements of the EBA’s technical standards, and can also help banks to meet TCFD reporting recommendations and EU Taxonomy alignment requirements.
Eric Moen, Head of ESG and Climate, at MSCI, said:
“The introduction of the European Banking Authority’s Pillar 3 ESG risk disclosure requirements and increasing stakeholder demands is putting greater scrutiny on financial institutions to measure climate risk transparency across their banking book. With this new disclosure framework in place, banks need to take urgent measures to ensure that they are meeting the regulatory requirements set out by EBA standard, as well as other region and country-specific frameworks. The new solutions from MSCI will help banks to familiarize themselves with the EBA’s expectations and their disclosure obligations.”