Guideline B-15 - Climate Risk Management

Banks/ BHC/T&L/Co-ops/Life/P&C/IHC

Climate Risk Management

March 2023 Page 1 of 16

Guideline

Subject: Climate Risk Management

Category: Sound Business Practices and Prudential Limits

No: B-15 Date: March 2023

A. Overview

Climate change and the global response to the threats it poses have the potential to significantly

impact the safety and soundness of federally regulated financial institutions (FRFIs), and the

financial system more broadly. These risks, also known as “climate-related risks”, are broadly

categorized as physical and transition risks.

• “Physical risks” refer to the financial risks from the increasing severity and frequency of

climate-related extremes and events (i.e., acute physical risks); longer-term gradual shifts

of the climate (i.e., chronic physical risks); and indirect effects of climate change such as

public health implications (e.g., morbidity and mortality impacts).

• “Transition risks” refer to the financial risks related to the process of adjustment towards

a low-greenhouse gas (GHG) economy. These risks can emerge from current or future

government policies, legislation, and regulation to limit GHG emissions, as well as

technological advancements, and changes in market and customer sentiment towards a

low-GHG economy.

Physical and transition risks can also lead to liability risks, such as the risk of climate-related

claims under liability policies, as well as litigation and direct actions against financial institutions

for failing to manage their climate-related risks.

Climate-related risks may manifest over varying time horizons, and are likely to intensify over

time, especially if the global economy undergoes a disorderly transition. They can drive financial

risks, such as credit, market, insurance, and liquidity risks. They can also lead to strategic,

operational, and reputational risks. In severe instances, climate-related risks can threaten the

long-term viability of a FRFI’s business model.

Building resilience against climate-related risks requires FRFIs to address vulnerabilities in their

business model, their overall operations, and ultimately on their balance sheet. This entails

forward-looking approaches that are holistic, integrated, and built on reliable empirical data and

sound analyses. It also necessitates FRFIs to continuously monitor and incorporate developments

in climate-related risk management, such as improving data quality and evolving risk

measurement methodologies, into their governance and risk management practices.

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A1. Purpose and Scope

The Guideline establishes OSFI’s expectations related to the FRFI’s management of climate-

related risks. It aims to support FRFIs in developing greater resilience to, and management of,

these risks. The Guideline applies to all FRFIs except foreign bank branches.

There is no one-size-fits-all approach for managing climate-related risks given the unique risks

and vulnerabilities that will vary with a FRFI’s size, nature, scope, and complexity of its

operations, and risk profile. The Guideline should be read, and implemented, from a risk-based

perspective that allows the FRFI to compete effectively while managing its climate-related

risks prudently.

A2. Structure of the Guideline

The Guideline is organized into chapters, each with its own focus and principles-based

expectations. These chapters are interrelated and mutually reinforcing. For example, enhanced

transparency through climate-related financial disclosures (Chapter 2) incentivizes improvements

in the quality of the FRFI’s governance and risk management practices (Chapter 1).

A3. Outcomes

The Guideline presents the following three expected outcomes for FRFIs to achieve.

‘Foreign bank branches’ refers to foreign banks authorized to carry on business in Canada on a branch basis under

Part XII.1 of the Bank Act.

This Guideline applies to Canadian branches of foreign insurers to the extent the expectations relate to, or impact,

the risks insured in Canada by the foreign insurer, the sufficiency of the related vested assets relative to the foreign

insurer’s insurance business in Canada, and/or and the Branch Adequacy Asset Test (BAAT) or Life Insurance

Margin Adequacy Test (LIMAT) targets.

• The FRFI understands and mitigates against potential impacts of climate-related

risks to its business model and strategy.

• The FRFI has appropriate governance and risk management practices to

manage identified climate-related risks.

• The FRFI remains financially resilient through severe, yet plausible, climate risk

scenarios, and operationally resilient through disruption due to climate-related

disasters.

 
 
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Table of Contents 
 
  Page 
 
A.  Overview ........................................................................................................................1 
A1. Purpose and Scope .............................................................................................2 
A2. Structure of the Guideline .................................................................................2 
A3. Outcomes ..........................................................................................................2 
Chapter 1 – Governance and Risk Management Expectations ............................................4 
I. Governance .................................................................................................................4 
II. Risk Management ......................................................................................................5 
A.  Risk Identification, Measurement, and Management ........................................5 
B.  Risk Monitoring and Reporting .........................................................................5 
III. Climate Scenario Analysis and Stress Testing.........................................................6 
IV. Capital and Liquidity Adequacy ..............................................................................6 
Annex 1-1 – Other OSFI Guidance ...............................................................................8 
Annex 1-2 – Examples of Climate-Related Transmission Channels .............................9 
Chapter 2 – Climate-Related Financial Disclosures ..........................................................10 
I. Purpose of Disclosure Expectations .........................................................................10 
II. Scope of Application ...............................................................................................10 
III. Principles for Effective Disclosure of Climate-related Risks ................................10 
IV. Implementation Date .............................................................................................13 
V. Location and Timing of Disclosures .......................................................................13 
VI. OSFI’s Financial Data Websites ............................................................................14 
VII. Frequency of Disclosure .......................................................................................14 
VIII. Disclosure Format ...............................................................................................14 
Annex 2-1 – Greenhouse Gas Emissions Accounting .................................................15 
Annex 2-2 - Minimum Mandatory Climate-Related Financial Disclosure Expectations16 
 
 
 
 
 
 

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Chapter 1 – Governance and Risk Management Expectations

This chapter outlines OSFI’s governance and risk management expectations for climate-related

risks. It complements and should be read in conjunction with other OSFI guidance that directly

or indirectly addresses various elements of climate risk management. See Annex 1-1 for a non-

exhaustive list of relevant OSFI guidance.

I. Governance

Principle 1: The FRFI should have the appropriate governance and accountability structure in

place to manage climate-related risks.

Please refer to OSFI’s Corporate Governance Guideline for OSFI’s expectations of FRFI

Boards of Directors in regards to business strategy and risk appetite, operational, business, risk

and crisis management policies.

1. Senior Management has overall accountability for the FRFI’s climate risk management.

The

FRFI should consider whether and how Senior Management compensation policies and

related practices should incorporate climate-related risk considerations.

Principle 2: The FRFI should incorporate the implications of physical risks from climate

change and the risks associated with the transition to a low-greenhouse gas (GHG) economy to

the FRFI in its business model and strategy.

2. The FRFI should identify and understand the impact of climate-related risks on the FRFI's

short-term and long-term strategic, capital, and financial plans.

3. The FRFI should develop and implement a Climate Transition Plan (Plan),

in line with its

business plan and strategy, that guides the FRFI’s actions to manage increasing physical risks

from climate change, and the risks associated with the transition towards a low-GHG

economy. In developing the Plan, the FRFI should assess the achievability of its Plan under

different climate-related scenarios and how it would measure and assess its progress against

the Plan (e.g., internal metrics and targets such as GHG emissions).

For foreign entities operating in Canada on a branch basis, OSFI looks to Branch Management to oversee

operations in Canada.

Climate-related risks can affect FRFIs through micro- and macro-economic transmission channels. Refer to Annex

1-2 for examples of these channels.

Refer to the Financial Stability Board’s Task Force on Climate-Related Financial Disclosures Guidance on

Metrics, Targets, and Transition Plans for additional guidance on elements to consider as part of transition planning.

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II. Risk Management

Principle 3: The FRFI should manage and mitigate climate-related risks in accordance with

the FRFI’s Risk Appetite Framework.

A. Risk Identification, Measurement, and Management

4. The FRFI should integrate climate-related risks into its Risk Appetite Framework and

Enterprise Risk Management (ERM) framework.

5. The FRFI should reflect climate-related risks in its Internal Control Framework, relevant

policies and practices, and articulate the roles and responsibilities of different business lines

and Oversight Functions in managing climate-related risks.

6. The FRFI should have processes and controls to identify and measure the current and

potential future impact of climate-related risks on its portfolio of exposures (e.g., credit,

market, operational, insurance, and liquidity) over appropriate time horizons.

7. The FRFI should identify, collect, and use reliable, timely, and accurate data pertaining to

physical risks (e.g., geophysical location of exposures) and transition risks (e.g., GHG

emissions data) relevant to its business activities to inform risk management and decision-

making. Where data gaps exist, the FRFI should consider alternative data sources or

reasonable proxies to bridge the gap.

8. The FRFI should implement relevant tools and models, including those used for climate

scenario analysis, to measure and assess its climate-related risks. Where the FRFI chooses to

use tools and models developed by external third parties to support its assessment, the FRFI

should sufficiently understand the embedded data, methodology, assumptions, and their

limitations.

B. Risk Monitoring and Reporting

9. The FRFI should incorporate climate-related risks into its internal monitoring and reporting

of business performance and risk management effectiveness. It should monitor and report on

relevant internal metrics, limits, and indicators to assess the effectiveness of its climate risk

management. It should also monitor and report on internal targets to assess the FRFI’s

progress in managing its physical risk exposures and risks associated with the transition

towards a low-GHG economy, consistent with its Plan.

10. The FRFI should develop capabilities to aggregate its climate risk data to identify and

internally report on climate-related exposures, including risk concentrations (e.g.,

geographies, sectors, products, or counterparties). It should also have internal reporting

Uncertainties may arise at each step of the measurement, methodology, or modeling process, which can result

from, but are not limited to, data (limitations around quality, representativeness, or historical coverage) or model

misspecification. The FRFI should consider applying a margin of conservatism to address these uncertainties.

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systems that can produce reliable, timely, and accurate reporting on these risks to support

strategic planning and risk management.

III. Climate Scenario Analysis and Stress Testing

OSFI may develop this section into a separate chapter in a future iteration of the Guideline.

Principle 4: The FRFI should use climate scenario analysis to assess the impact of climate-

related risks on its risk profile, business strategy, and business model.

Climate scenario analysis: Climate scenario analysis uses a hypothetical future state of the

world to assess the impact of climate-related risks on a FRFI's operations. These exercises can

help the FRFI achieve different objectives in its strategic planning and enterprise risk

management, such as:

• Assessing the impact of physical and transition risks on the FRFI’s strategy and risk

profile, and the resiliency of its business model;

• Identifying relevant climate-related risk factors that can drive the FRFI’s financial

and non-financial risks, and estimating exposures and potential losses;

• Identifying data, methodology, and assumption limitations; and

• Informing the adequacy of the FRFI’s risk management framework.

11. When undertaking climate scenario analyses, the FRFI should consider a range of plausible

and relevant models and climate scenarios, over various time horizons (i.e., short-, medium-

and long-term), when climate-related risks can materialize and drive the FRFI’s risks.

12. The FRFI should consider climate scenarios that encompass both physical and transition

risks, and the potential interplay between these two types of risks. The FRFI should also

understand the methodology and approaches used, including data and methodological

limitations, and assumptions.

In addition to FRFIs’ own internal climate scenario analysis to understand the resilience of

their business model and strategy, FRFIs will be required to complete standardized climate

scenario exercises and report their results to OSFI on a periodic basis. These exercises will

enable OSFI to assess aggregate exposures to physical and transition risks and compare FRFI

approaches to climate scenario analysis.

IV. Capital and Liquidity Adequacy

OSFI may develop this section into a separate chapter in a future iteration of the Guideline.

When selecting relevant climate scenarios, the FRFI should consider industry-accepted sources, such as the

International Energy Agency (IEA), the Intergovernmental Panel on Climate Change (IPCC), and the Network for

Greening the Financial System (NGFS). The FRFI should also consider domestic and global policies and legislation,

such as the Canadian Net-Zero Emissions Accountability Act.

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Principle 5: The FRFI should maintain sufficient capital and liquidity buffers for its climate-

related risks.

13. The FRFI should incorporate climate-related risks into its Internal Capital Adequacy

Assessment Process (ICAAP) or Own Risk and Solvency Assessment (ORSA) process.

14. The FRFI should incorporate the impact of climate-related drivers on its liquidity risk profile

and integrate a range of FRFI-specific and market-wide severe, yet plausible, climate-related

stress events when assessing the adequacy of its liquidity buffers.

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Annex 1-1 – Other OSFI Guidance

This Guideline complements other OSFI guidance that directly or indirectly addresses various

elements of climate risk management, including but not limited to:

1. Corporate Governance Guideline, which sets out OSFI’s expectations of Board of

Directors and FRFI management on corporate governance.

2. Guideline E-18: Stress Testing, which sets out OSFI’s expectations on the use of stress

testing for senior management to use in making business strategy, risk management, and

capital management decisions.

3. Guideline E-19: Own Risk and Solvency Assessment (ORSA), which sets out OSFI’s

expectations of an insurer's own assessment of its risks, capital needs and solvency

position, and for setting Internal Targets, based on an insurer's ORSA.

4. Guideline E-19: Internal Capital Adequacy Process (ICAAP), which sets out OSFI’s

expectations of federally regulated deposit-taking institutions’ own assessment of the

adequacy of their capital.

5. Guideline B-10: Third-Party Risk Management Guideline, which sets out OSFI’s

expectations on FRFI management of risks associated with third-party arrangements.

6. Guideline E-23: Enterprise-wide Model Risk Management for Deposit-Taking

Institutions, which sets out OSFI’s expectations on institutions’ establishment of sound

policies and practices for an enterprise-wide model risk management framework.

7. Guideline E-21: Operational Risk Management, which sets out OSFI’s expectations on

FRFIs’ management of operational risk.

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Annex 1-2 – Examples of Climate-Related Transmission Channels

Physical Risk

Increased frequency and severity of

weather events

Risk Event

Credit Risk: Damage to collateral for bank

loans

Market Risk: Physical damage and a

perception of heightened risk that can

affect the market value of investments

Insurance Risk: Insurance claims

consistently exceed insurance company

expectations

Operational Risk: Physical damage to

premises; outage of critical services or

functions (e.g., bank branch, insurance

claims department)

Potential Impact or Loss

Credit Impact: Higher loan to value and

loss given default (LGD) due to reduced

collateral value; leading to higher capital

requirements

Market Loss: Mark-to-Market (MTM)

investment and/or trading losses

Insurance Loss: Increased insurance losses

and increase cost to reinsure

Operational Loss: Losses due to physical

damage and/or outage; potential

reputational damage

Transition Risk

Increased regulation related to GHG-

intensive industries

Risk Event

Credit Risk: GHG-intensive borrowers face

higher costs of doing business and/or

lower revenues reducing profitability

Market Risk: Unexpected valuation

change in debt and equity securities issued

by impacted firms

Liquidity Risk: An institution with a GHG-

intensive portfolio may experience

diminished demand for its funding

instruments in wholesale debt markets as its

assets become more illiquid

Liability Risk: The Board of the FRFI may

not be seen as fulfilling its legal obligations

and appropriately accounting for and

managing its climate-related risks

Potential Impact or Loss

Credit Impact: Increased probability of

default due to pressures on the borrower

and LGD due to stranded assets, which

could lead to higher capital requirements

for the FRFI

Market Loss: Investment and/or trading

losses linked to securities issued by

impacted firms

Liquidity Impact: Potential challenges

rolling over debt or raising capital

Legal Impact: Possible legal action against

the FRFI Board; potential reputational

damage to the FRFI

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Chapter 2 – Climate-Related Financial Disclosures

This chapter outlines OSFI’s expectations for the disclosure of climate-related risks.

I. Purpose of Disclosure Expectations

1. OSFI reinforces its climate risk management expectations through climate-related financial

disclosure expectations. Climate-related financial disclosures help OSFI to meet its mandate

of protecting depositors, creditors, and policyholders, and contributing to public confidence

in the Canadian financial system, by ensuring relevant information is publicly available to

enable understanding of FRFIs’ financial condition and the risks to which they are exposed.

2. Users interested in FRFIs’ climate-related financial risk information may also include

investors, analysts, and the public at large. By providing this broad group of users with

relevant risk and risk management information, these disclosures can build confidence in

FRFI management, and enable FRFIs to attract, or maintain their access to, capital and

liquidity channels. By extension, confidence in FRFIs contributes to the public confidence in,

and resilience of, the Canadian financial system.

II. Scope of Application

3. This chapter applies to all FRFIs in the scope of this Guideline, except for subsidiaries of

FRFIs that report consolidated results to OSFI.

4. For FRFIs whose parent company (domestic or international) does not report consolidated

results to OSFI, the FRFI is permitted to reference group-level disclosures for the

corresponding reporting period and to provide supplementary information on FRFI-specific

items as applicable to meet the disclosure expectations of this Guideline.

III. Principles for Effective Disclosure of Climate-related Risks

5. The fundamental principles set out below provide guidance to FRFIs on OSFI’s expectations

for climate-related financial risk disclosures. These principles can help achieve high-quality

and decision-useful disclosures that enable users to understand the financial impact of

climate change on FRFIs. FRFIs should present disclosures that reflect the principles below.

6. The FRFI may encounter tension in the application of the principles set out below, whether

between principles or within a single principle.

Such tensions are inevitable given the wide-

ranging and sometimes competing needs of users and preparers of disclosures. The FRFI

should aim to find an appropriate balance of disclosures that reasonably satisfy the

expectations and principles without overwhelming users with unnecessary information.

For example, the FRFI may update a methodology or increase the level of detail disclosed to improve the relevance

of disclosure, at the expense of consistency of disclosure. Tension can also arise within a single principle. For

example, Principle 4 states that disclosures should be verifiable, but assumptions made about future-oriented

disclosures often require significant judgment by FRFI management that is difficult to verify.

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7. OSFI expects a FRFI to continually look to evolve its disclosure practices, and to regularly

review disclosures for relevance, comprehensiveness, and clarity

Principle 1: The FRFI should disclose relevant information.

8. The FRFI should provide information specific to the current and potential future impact of

climate-related risks and opportunities on its markets, businesses, corporate or investment

strategy, financial statements and reports, and future cash flows.

9. The FRFI should present disclosures in sufficient detail to enable users to assess its exposure

and approach to addressing climate-related risks, which is expected to evolve over time as

FRFI practices mature.

10. The FRFI should provide information from the perspective of the current and potential future

impact of climate-related risks and opportunities on value creation, considering and

addressing the different time frames and types of impacts.

Principle 2: The FRFI should disclose specific and comprehensive information.

11. The FRFI should provide disclosures of its exposure to current and potential future impacts

of physical and transition risks; the potential nature and size of such impacts; the FRFI’s

governance, strategy, processes for managing these risks, and performance with respect to

managing climate-related risks and opportunities.

12. To be sufficiently comprehensive, the FRFI should include historical and future-oriented

information in its disclosures to allow users to evaluate their previous expectations relative to

actual performance and assess possible future financial implications.

13. For quantitative information, the FRFI should use data that is consistent with what is used in

its investment and risk management decision-making. The FRFI should provide an

explanation of the definition, measurement framework used, scope applied, and for future-

oriented information, the key assumptions and judgments used. The FRFI should explain any

data limitations and/or methodology challenges it faced during the reporting period and their

impact on disclosure.

14. Any scenario analyses should be based on data or other information used by the FRFI for

investment decision-making and risk management. Where appropriate, the FRFI should also

demonstrate the effect on selected risk metrics or exposures of changes in the key underlying

methodologies and assumptions, both in qualitative and quantitative terms.

15. Management should exercise discretion to avoid disclosing proprietary and/or confidential

information.

As data quality, availability and scenario analysis capabilities improve, OSFI expects to issue updated climate-

related financial disclosure expectations in the future with increased expectations.

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Principle 3: The FRFI should disclose clear, balanced, and understandable information.

16. The FRFI should present disclosures that communicate financial information that serves the

needs of a range of users (i.e., sufficiently granular to inform sophisticated users but also

provide concise information for those who are less specialized.)

17. The FRFI should show an appropriate balance between qualitative and quantitative

information and use text, numbers, and graphical presentations in its disclosures as

appropriate.

18. The FRFI should include fair and balanced narrative explanations that provide insight into

the meaning of quantitative disclosures, including the changes or developments they

portray over time.

19. The FRFI should provide straightforward explanations of risks and opportunities in its

disclosures. Terms used in the disclosures should be explained or defined for a proper

understanding by the users.

Principle 4: The FRFI should disclose reliable and verifiable information.

20. The FRFI should provide high-quality reliable information in its disclosures. This

information should be neutral—i.e., free from bias.

21. The FRFI should report information that is verifiable (e.g., amounts disclosed should be

traceable to their sources). Disclosures should be defined, collected, recorded, and

analyzed in such a way that the information reported is verifiable to ensure it is high

quality.

22. To the extent practicable, the FRFI should base its disclosures on objective data and use

best-in-class measurement methodologies, which would include common industry

practice as it evolves.

23. The FRFI should adequately explain future-oriented disclosures that involve the FRFI’s

judgment and ensure such disclosures are reasonable and supported.

24. The disclosures should be subject to internal governance processes and controls that are

the same or substantially like those used for financial reporting.

25. The disclosures are not expected to be subject to independent external assurance at this

time, but FRFIs should work towards a future state in which external assurance is

expected.

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Principle 5: The FRFI should disclose information appropriate for its size, nature, and

complexity.

26. The volume and level of detail of disclosure should be greater for a FRFI that is larger,

has more varied business lines and geographic locations, or is systemically important, than

for other FRFIs. The FRFI should exercise discretion in determining the appropriate level of

detail in its disclosures to enable transparency of its risks, risk management practices, and

opportunities.

Principle 6: The FRFI should disclose information consistently over time.

27. The FRFI should disclose consistently over time to enable users to understand the impact

of climate-related risks on the FRFI’s business and to allow for meaningful inter-period

comparisons.

28. The FRFI should explain:

• inter-period variances in amounts disclosed;

• the underlying reasons for the inter-period variances in amounts disclosed (e.g.,

whether due to changes in climate-related risks, measurement methodologies,

presentation, or a combination); and

• the impact of these reasons on prior period comparability of effected amounts in terms

of direction and magnitude.

In such instances, or if new information becomes available, retrospective restatement is

allowed but not mandatory.

IV. Implementation Date

29. The FRFI is expected to implement the expectations in Annexes 2-1 and 2-2 of this

Guideline effective the fiscal periods ending on or after October 1, 2024, 2025 and

2026, as applicable. The FRFI may voluntarily early adopt disclosure expectations.

V. Location and Timing of Disclosures

30. The FRFI may exercise discretion regarding the location of the disclosures expected by

this Guideline. Possible locations include but are not limited to: Report to Shareholders

(if disclosed to the public), or a stand-alone report (e.g., Environmental, Social, and

Governance, or “ESG”, Report, Climate Risk Report, Pillar 3 Report). The FRFI may

exercise discretion in signposting disclosure expectations of this Guideline to publicly

available reports of its choice.

31. The FRFI is expected to make its climate-related financial disclosures publicly available

(i.e., on the FRFI’s company website) no later than 180 days after fiscal year-end, as

“Report to Shareholders” includes the Primary Financial Statements (Statement of Financial Position, Statement

of Profit or Loss and Other Comprehensive Income, Statement of Changes in Equity, Statement of Cash Flows),

Notes to the Financial Statements and Management’s Discussion & Analysis.

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applicable. The FRFI should maintain an ongoing archive of all disclosures relating to

prior reporting periods.

VI. OSFI’s Financial Data Websites

32. In-scope FRFIs which are neither a D-SIB

nor an IAIG

Headquartered in Canada are

expected to provide in their climate-related financial disclosures a link to one of OSFI’s

Financial Data websites

as appropriate, to alert readers to additional information available.

VII. Frequency of Disclosure

33. The frequency for the disclosures expected by this Guideline is annual. The FRFI may

voluntarily present the expected disclosures on more frequent basis.

VIII. Disclosure Format

34. The format for the disclosures expected by this Guideline is flexible. The FRFI may present

the expected information in the format that best suits the FRFI.

Consistent with other OSFI Guidance, OSFI identifies D-SIBs as Bank of Montreal, Bank of Nova Scotia,

Canadian Imperial Bank of Commerce, National Bank of Canada, Royal Bank of Canada, and Toronto-Dominion

Bank.

The term "IAIGs” refers to Internationally Active Insurance Groups. "IAIGs headquartered in Canada" refers to

Sun Life Assurance Company of Canada, Manufacturers Life Insurance Company, Canada Life Assurance

Company, and Intact Financial Corporation.

OSFI’s financial Data websites: https://www.osfi-bsif.gc.ca/Eng/wt-ow/Pages/fd-df.aspx

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Annex 2-1 – Greenhouse Gas Emissions Accounting

1. Regarding calculation of GHG emissions, (in Annex 2-2, “Metrics and Targets” Disclosure

Elements b) i and b) ii), the FRFI is expected to use the latest GHG Protocol Corporate

Accounting and Reporting Standard and the latest GHG Protocol Corporate Value Chain

(Scope 3) Accounting and Reporting Standard, or comparable reporting standards.

2. Regarding calculation of the portion(s) of Scope 3 GHG emissions, ((in Annex 2-2,

“Metrics and Targets” Disclosure Element b) ii)), pertaining to the FRFI’s financed,

facilitated and/or insured GHG emissions, the FRFI is expected to use the latest Partnership

for Carbon Accounting Financials’ (PCAF’s) Global GHG Accounting and Reporting

Standard for the Financial Industry (PCAF Standard), including any applicable phase-in of

sectors / industries, or a comparable industry-accepted approach.

3. See Annex 2-2 - Minimum Mandatory Climate-Related Financial Disclosure Expectations

for detailed disclosure expectations and implementation dates.

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Annex 2-2 - Minimum Mandatory Climate-Related Financial Disclosure Expectations

Fiscal Year-end for Which Implementation Is Expected

(Reporting date is 180 days post fiscal year-end, at the latest)

Deposit-taking Institutions

Insurers

Disclosure