In today's fast evolving financial landscape, credit
institutions must integrate Environmental, Social, and Governance
("ESG") risk management into their
internal governance frameworks. This shift is not merely a
regulatory requirement but a strategic necessity to mitigate
financial risks and enhance long-term resilience. CRD
VI1 was published on 19 June 2024 with an implementation
deadline until 10 January 2026. It sets out a comprehensive
framework for ESG risk management for credit institutions and
certain investment firms.
Why ESG risks matter?
Environmental risks, such as those stemming from climate change,
social factors like health and working conditions, and governance
elements, including leadership qualities and diversity, can have a
significant impact on the financial stability of institutions.
These risks may affect counterparties and, consequently, the
institutions themselves. Moreover, consideration of ESG factors is
necessary to ensure compliance
