Regulatory Alerts2021-06-21
Added · Updated
Circular CSSF 21/773 on the Management of Climate-related and Environmental Risks
This Circular applies to all credit institutions designated as Less Significant Institutions under the Single Supervisory Mechanism and to all branches of non-EU credit institutions. It requires these institutions to regularly assess the materiality of climate-related and environmental risks, integrate them into business strategies, risk appetite frameworks, and risk management systems, and document risk identification in ICAAP and ILAAP reports. The management body must explicitly endorse assessments of climate impacts, assign responsibilities within the three lines of defence, and ensure adequate staff training and reporting. The Circular became applicable on its publication date, with institutions expected to begin reviewing their frameworks by mid-year 2021.
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