UNEP FI TCFD Banking Pilot Projects 

NEW for February 2021:

UNEP FI’s TCFD Banking programme has launched 3 new papers relating to scenario analysis, recommendations on integrated assessment models, tools, the changing regulatory landscape as well as potential developments in 2021.

  • Decarbonisation and Disruption: Understanding the financial risks of a disorderly transition using climate scenarios covers two primary themes of relevance to financial institutions, with support from Oliver Wyman. First, it examines sector specific risk drivers that could result in a disorderly transition, making the argument that climate transition risk is a significant near-term threat to much of the economy. Second, the report explored how these risk drivers are currently being modeled in climate scenarios produced by major integrated assessment models (IAMs). The paper also includes bank case studies that affirm greater economic risks associated with disorderly transition scenarios compared with orderly transition scenarios.
  • Pathways to Paris: A practical guide to climate transition scenarios for financial professionals is a detailed guide, in partnership with CICERO, for financial sector practitioners looking to understand and apply climate scenarios in a financial risk context. This paper also provides a series of recommendations for enhancing the development and application of Integrated Assessment Models (IAMs) by financial institutions based on perspectives of participating banks that used UNEP FI’s transition risk methodology. This paper also contains case studies from participating banks that capture their experiences using climate scenarios.
  • The Climate Risk Landscape: Mapping Climate-related Financial Risk Assessment Methodologies provides a summary of the key developments across third party climate risk assessment providers since May 2019, including new and updated scenarios, methodological tools, key guidelines, as well as an overview of the changing regulatory landscape and potential developments into 2021.

You can see the full outcomes from Phase II of UNEP FI’s TCFD programme below, and how they fit within the pillars of TCFD


Phase III

Phase III of the TCFD banking pilot commenced in January 2021. This pilot will more fully explore climate stress testing, the integration of physical and transition risk assessments, and sector-specific risks and opportunities. If you are interested in participating in Phase III or would like to learn more, please contact David Carlin (David.Carlin@un.org).


Phase II (2019 – 2021)

Building on the success of Phase I, from 2019-2020, UNEP FI’s Phase II TCFD Banking program helped thirty-nine global banks on six continents to enhance their climate risk toolkits and improve their climate risk disclosures. Supported by a wide range of expert partners, participants explored both physical and transition risks and opportunities.

Phase II focused on the four pillars of TCFD disclosures: Governance, Strategy, Risk Management, and Metrics & Targets. The program developed tools, frameworks, and thought papers that enabled participants to better address each of the recommended disclosures within these pillars. Beyond building capacity for participants, the Phase II outputs aimed to establish good practices for TCFD disclosures across the financial sector.

The following figure shows how each specific output from Phase II connects to a TCFD pillar. Below the figure is a brief description and link to each of these publicly accessible outputs.

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Outputs of Phase II:

  • Charting a New Climate (with Acclimatise)- a state-of-the-art blueprint to support financial institutions in navigating the changing physical climate risk landscape. The report explores physical risk data, tools, correlation analyses, heatmapping, and opportunity identification among other crucial topics.
  • From Disclosure to Actiona stock-take on how financial institutions are incorporating climate risk into their operations. Numerous bank case studies and UNEP FI TCFD participant survey results provide details on the latest practices. The paper also provides concrete and actionable guidance on integrating climate risk throughout an organization.
  • Beyond the Horizon– an exploration of the ways in which the UNEP FI TCFD program advanced transition risk analysis. A major feature of the report is a comprehensive transition risk heatmap developed by the participating institutions that provides perspectives into how climate-sensitive sectors may be impacted by a low-carbon transition.
  • TCFD Playbook (with the Institute for International Finance)- developed through consultation with member financial institutions, this document provides guidance on and examples of leading practices around TCFD reporting in the financial sector. This desk reference also aims to enhance the depth and comparability of TCFD disclosures by financial institutions.
  • Transition Check (with Oliver Wyman)- a user-friendly webtool that enables financial institutions to assess transition risks across a wide range of geographies, economic sectors, and climate scenarios (including the latest NGFS scenarios). Transition Check produces loss estimates, PDs, and LGDs in a clean, downloadable format to support internal assessments and TCFD reporting.
  • Pathways to Paris: A practical guide to climate transition scenarios for financial professionals is a detailed guide, in partnership with CICERO, for financial sector practitioners looking to understand and apply climate scenarios in a financial risk context. This paper also provides a series of recommendations for enhancing the development and application of Integrated Assessment Models (IAMs) by financial institutions based on perspectives of participating banks that used UNEP FI’s transition risk methodology. This paper also contains case studies from participating banks that capture their experiences using climate scenarios.
  • Decarbonisation and Disruption: Understanding the financial risks of a disorderly transition using climate scenarios covers two primary themes of relevance to financial institutions, with support from Oliver Wyman. First, it examines sector specific risk drivers that could result in a disorderly transition, making the argument that climate transition risk is a significant near-term threat to much of the economy. Second, the report explored how these risk drivers are currently being modeled in climate scenarios produced by major integrated assessment models (IAMs). The paper also includes bank case studies that affirm greater economic risks associated with disorderly transition scenarios compared with orderly transition scenarios.
  • TCFD database (to be released in 2021)- UNEP FI produced an exhaustive survey of our membership regarding climate disclosure and climate scenario analysis practices. Now, we are working to make this data accessible to financial institutions so that they can benchmark their practices to others across the industry.

Phase II of the TCFD Banking Pilot included the following banks:


Regional Reports


Phase I (2017 – 2018)

UNEP FI, together with 16 of the world’s leading banks, set out on a year-long project to pioneer and further develop transition and physical assessment models and metrics to enable scenario-based, forward-looking assessment and disclosure of climate-related risks and opportunities.

The contributions of the pilot have better equipped participating banks and the banking industry at large to implement the recommendations of the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD).

Access the outcomes of the phase I :

Extending our Horizons: Assessing Credit Risk and Opportunity in a Changing Climate– Published in April 2018, the report details the jointly developed methodology for scenario-based assessment of the transition-related risk and opportunities.

Navigating a New Climate: Assessing Credit Risk and Opportunity in a Changing Climate – The second report, released in July 2018, covers physical risk assessment methodologies.

The UNEP FI TCFD pilot group included the following UNEP FI member banks: ANZ, Barclays, BBVA, BNP Paribas, Bradesco, Citi, DNB, Itaú, National Australia Bank, Rabobank, Royal Bank of Canada, Santander, Société Générale, Standard Chartered, TD Bank Group and UBS.

Member Reports :

TCFD Reporting by UNEP FI Pilot Banks

All 16 banks participating in the UNEP FI TCFD Pilot committed to publishing an initial TCFD disclosure by mid-2019.

Please see examples here:

ANZ TCFD Report            Citi TCFD Report