FSOC Identifies Climate Change As Emerging Threat To Financial Stability

In a report on climate-related financial risk, the Financial Stability Oversight Council ("FSOC") identified climate change as an emerging and increasing threat to U.S. financial stability. Treasury stated that the report was issued in response to Executive Order 14030 ("Climate-Related Financial Risk").

In the report, FSOC emphasized the need to coordinate among agencies and made over 30 recommendations to its members, including, among others, that they:

• build their capacity to address climate-related financial risks through (i) increased internal expertise and (ii) understanding adverse impacts on financially vulnerable populations;
• address climate-related data gaps, develop consistent data standards and engage in climate-related data sharing with other members;