Six major American financial institutions struggled to accurately assess the extent of their exposure to climate change and related risks, according to the Federal Reserve.
The Fed ran a pilot program for six leading American banks to assess how ready they are to keep track of the risks that climate change poses to their businesses, a practice that the Securities and Exchange Commission (SEC) is attempting to mandate for large corporations across the country. The banks — JP Morgan, Wells Fargo, Bank of America, Goldman Sachs, Morgan Stanley and Citigroup — generally struggled to assess their exposure to climate change because they lacked key data and because climate risk modeling is so new that even the country’s biggest banks could not identify reliable techniques, according to the Fed’s May report on the pilot program.
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