Financial Stability Oversight Council Report on Climate-Related Financial Risk: Seven Things to Know

Financial Stability Oversight Council Report on Climate-Related Financial Risk: Seven Things to Know

October 22, 2021, Covington Alert

On Thursday, October 21, 2021, the Financial Stability Oversight Council (“FSOC” or “Council”) released a Report on Climate-Related Financial Risk (the “Report”). The Report represents the culmination of a deliberative process that began on May 20, 2021, when President Biden signed an Executive Order on Climate-Related Financial Risk. That order required FSOC to issue a report on efforts by its member agencies to integrate climate-related financial risk into their policies and specifically mandated discussions of (i) climate-related disclosure; (ii) climate-related regulation and supervision; (iii) the identification and measurement of climate-related financial stability risk; and (iv) other recommendations for climate risk mitigation, including new or revised regulations.