The Basel Committee on Banking Supervision (BCBS) recently concluded a consultation on climate scenario analysis. The purpose of this consultation was to suggest improvements to the use of climate scenarios for the end users in the financial sector, as well as their supervisors.

Even though the scenarios designed by NGFS (used widely in the financial sector) have been improved since the last time SFL analyzed them, we indicated in our feedback to BCBS that fundamental issues still exist with the design of these scenarios. Their continued reliance on integrated assessment models results in overoptimistic outcomes, leading to the further underestimation of the need for financing the green transition. For more information, please consult our complete feedback to the consultation.

Download the our response to the consultation in the below.