Therefore, it is important for financial institutions to conduct appropriate risk management based on the impact of climate change. However, a key feature of climate change issues is  8  that they are difficult to incorporate directly into existing risk management frameworks.
The time horizon over which risks may materialize is extremely long and uncertain, and the data necessary for risk management do not exist. How to deal with these issues represents an urgent challenge not only for financial institutions but also for central banks and financial supervisory authorities.