On October 14, as a follow-up to President Biden’s May 20 Executive Order on climate-related financial risk, the White House released a report titled “A Roadmap to Build a Climate-Resilient Economy.” In this report, the White House states that climate change poses “serious and systemic risks to the U.S. economy and financial system.” According to Politico (subscription required), While House Climate Advisor Gina McCarthy, in comments to reporters, said the above quote.
The report outlines a climate risk accountability framework and provides a roadmap of executive action along the six lines of work outlined in the Executive Order:
- Promoting the resilience of the U.S. financial system to climate-related financial risks;
- Incorporating climate-related financial risk into Federal financial management;
- Using Federal procurement to address climate-related financial risk;
- Protecting life savings and pensions from climate-related financial risk;
- Incorporating climate-related financial risk into Federal lending and underwriting; and
- Building resilient infrastructure and communities.
In a section devoted to financial regulation, the White House roadmap notes that a forthcoming report from the Financial Stability Oversight Council (FSOC) will discuss the importance of climate-related disclosures by regulated entities, current approaches to incorporating climate-related financial risk into regulatory and supervisory activities, and recommended processes to identify climate-related financial risks to U.S. financial stability. (The FSOC is expected to release its climate report Monday.) Work related to mandatory climate disclosures underway at the Securities and Exchange Commission (SEC) is also referenced in the roadmap.