We need data on underlying climate risks, for instance on the frequency and severity of extreme weather events. Finally, to fully understand the systemic perspective, we will also need data to assess the degree to which climate-related risks might be transferred, amplified or mitigated by different financial sectors.
Such data provide the raw material for the third building block of the FSB roadmap – vulnerabilities analysis. To examine vulnerabilities from a long-term, forward-looking perspective, it is critical to further develop scenario analysis, making use of the common NGFS climate scenarios. At the same time, we need to devise simpler indicators that can help identify the build-up of vulnerabilities.