Skip to main content

2024 Climate Risk Landscape Report

As climate change challenges intensify and the pursuit of net-zero emissions accelerates, the financial industry is increasingly recognizing its critical role in driving adaptation measures and implementing comprehensive risk mitigation strategies.

The newly released 2024 Climate Risk Landscape Report by the United Nations Environment Programme Finance Initiative (UNEP FI) emerges as a crucial resource, offering current insights and a strategic framework to guide financial institutions in this complex and evolving landscape.

The 2024 Climate Risk Landscape Report offers a thorough analysis of the climate risk tool market, aiming to enhance transparency and guide financial institutions through the complex terrain of climate-related risks. The report highlights several market challenges, including the complexities of sector-specific analysis, regional resource imbalances, and accessibility hurdles in climate tools. It underscores the difficulties in analyzing specific sectors, unlisted assets, and supply chains due to the intricate nature of climate assessments. Furthermore, it addresses the challenge of unequal resource availability across regions, which can lead to the underutilization of climate tools, particularly in emerging markets. The report also warns of the high costs and limited access to climate tools, creating imbalances in global adoption.

The report emphasizes the importance of regulatory compliance, noting the emergence of new functionalities designed to meet regulatory and stress-testing requirements. It also highlights the increasing integration of artificial intelligence in climate tools, which improves their capabilities but introduces new risks that must be carefully managed. Additionally, open-source innovations and enhanced data access provided by data and tool vendors are revolutionizing how climate risks are assessed.

The report outlines best practices for effectively leveraging climate tools, such as conducting holistic risk evaluations and seamlessly integrating these tools into existing accounting and risk management systems. It recommends that climate tools and their results be accessible across all relevant departments within financial institutions. Capacity building and internal tool development are also emphasized, encouraging institutions to start with open-source data and platforms to identify critical hotspots before integrating external climate tools and developing custom solutions.

Navigating the intricate landscape of climate risks requires cooperation among stakeholders, particularly within the financial sector. The UNEP FI's 2024 Climate Risk Landscape Report calls for continued collaboration and innovation to ensure financial institutions can effectively contribute to a resilient, low-carbon future. By integrating climate risk assessments into their strategic planning, financial institutions play a crucial role in mitigating the impacts of climate change and supporting global sustainability efforts.

For inquiries please contact:

RBI Regulatory Advisory

Raiffeisen Bank International AG | Member of RBI Group | Am Stadtpark 9, 1030 Vienna, Austria  | Tel: +43 1 71707 - 5923