Climate change, resource depletion, environmental degradation and social issues represent significant prospective risks for customer companies, on which a bank must become fully aware. Central banks and Supervisors are working on these issues to introduce new Risk management and monitoring practices. The European Commission is exploring the feasibility of including a Green supporting factor, i.e. how to reduce the burden of risk for banks’ exposures to green assets under banks’ capital requirements. To respond to these changes, sustainability issues will have to enter the strategic and operational agendas of banking institutions on a permanent basis.
