Providing advice on climate-related financial risks to federal financial institution regulators is the charge of a new a committee established late Monday by the Financial Stability Oversight Council (FSOC), the council announced Monday.
The new Climate-related Financial Risk Advisory Committee (CFRAC), according to Treasury Secretary Janet Yellen, who chairs the FSOC, will help to improve the collective understanding of how climate change may impact the financial sector. “The newly established advisory committee will also ensure that state and federal policymakers hear from leading experts on climate-related financial risks,” Yellen said.
According to Treasury, the 20-member CFRAC will help the FSOC receive information and analysis on climate-related financial risks from a broad array of stakeholders. Members of the group, Treasury said, include stakeholders from a range of backgrounds, including the financial services industry, non-governmental research institutions, climate-related data and analytics providers, non-profit organizations, and academia.
“Members’ climate data and analytical expertise will support regulators’ efforts to translate climate-related risks into economic and financial impacts,” Treasury said.
The group’s first meeting is expected to be held in early 2023. According to its charter, also published Monday, the council’s purpose will be to assist the FSOC “in gathering information on, conducting analysis of, and making recommendations to identify, assess, and mitigate climate-related risks to the financial system, consistent with the Council’s purposes and duties under the (2010) Dodd-Frank (Wall Street Reform and Consumer Protection) Act.”