Executive summary

Regulators in the Asia-Pacific (APAC) region have, since 2020, issued guidance on how banks and other financial institutions should adapt their governance framework, strategy, risk management approach, and disclosures to mitigate risks posed by climate change.

In several countries, these have been accompanied by risk stress tests to identify vulnerabilities and assess the preparedness of the sector to climate change.

The APAC countries are at different points in this journey, with guidance varying from statutory requirements to advice on good practice. But the climate risk guidance provided by the respective regulatory authorities also share many common elements.

This whitepaper explores the state of climate risk regulation and the guidance for financial institutions by regulators in seven major APAC countries - Australia, Hong Kong, India, Japan, Malaysia, Singapore and Thailand - and discusses the differences in their regulation of climate risk, as well as similarities.