Fed blocks tough climate risk proposal by global banking watchdog, Bloomberg reports – Reuters

Key points:

• The U.S. Federal Reserve blocked a proposal by the Basel Committee on Banking Supervision to focus on climate risk in financial rules.
• The Basel Committee had suggested that banks disclose information on the impact of climate change on their business starting in 2026.
• The European Central Bank is also advocating for lenders to disclose their strategies to meet climate commitments.
• There is resistance against tough climate disclosure proposals from U.S. companies, with critics accusing watchdogs of prioritizing politics over financial regulation.

Quotes:

• There has been fierce resistance against tough proposals on climate disclosures from U.S. companies. Last month, 10 Republican-led states sued the Securities and Exchange Commission, challenging new federal rules that require U.S.-listed companies to report climate-related risks.
• Critics of tougher climate proposals accuse the watchdogs of prioritizing political objectives over sound financial regulation, but supporters say the disclosures are required to limit financing to the fossil fuel industry.

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