From the perspective of governance, it was found that while organisational structures have improved, they are still in the early stages of tackling climate risks in a detailed comprehensive manner. And from a risk management perspective, again while progress has been identified in the development of methods to measure climate risks, only 25% of banks can call on advanced methods.
In addition to these European initiatives, the Central Bank also conducted a horizontal assessment of Less Significant Institutions’ (LSIs’) board-approved plans relating to climate-related and environmental risks in 2022. Again, while we acknowledge that some progress has been made since the initial assessment, the majority of these plans lacked ambition, with significant variations in the quality of the plans received.