The Network for Greening the Financial System (NGFS) has released technical guidance to central banks and financial markets supervisors on developing scenarios to assess nature-related financial risks. The guidance takes into account the specificities of nature-related issues by building on NGFS’ existing knowledge on climate-related scenarios and is planned to be a first step towards an integrated assessment of climate and broader nature-related risks. In a forward to the technical guidance, Ravi Menon, Chair of the NGFS and Managing Director of the Monetary Authority of Singapore, Emmanuelle Assouan, Co-chair of the Taskforce on Nature-related Risk, Banque de France and Marc Reinke, Co-chair of the Taskforce on Nature-related Risks, De Nederlandsche Bank, said: “The need to act is equally urgent for central banks and supervisors. Nature loss is a material source of risks for our economies and financial systems.” In March 2022, the NGFS recognised in a statement on nature-related financial risks that the degradation of nature, and action aimed at preserving and restoring it, can have macroeconomic, macroprudential, and microprudential consequences. Earlier this year, NGFS published a conceptual framework for nature-related risks. “A logical next step is the development of tools that will help central banks and supervisors assess how our economies and financial systems might be affected by various assumptions of nature-related physical risks and transitions policies,” said Menon, Assouan and Reinke.
Today @NGFS_ publishes its Technical Doc on developing nature scenarios for fin risk assessment
I was delighted to be part of the Taskforce working on this along with @Nepo_Dunz @RomainSvartzman Mathilde Salin & others
Thread to follow..@IIPP_UCL https://t.co/STniMuqere
— Katie Kedward (@katie_kedward) December 13, 2023
