NEW DELHI – The Indian central bank will require lenders to disclose climate finance risks starting in April 2025 and to meet certain climate targets beginning in 2027.
“Inadequate information about climate-related financial risks can lead to mispricing of assets and misallocation of capital by them,” the Reserve Bank of India (RBI) said in proposed requirements for a “better, consistent and comparable disclosure framework” for banks and large non-bank financial companies.
The central bank in 2022 had suggested disclosures could be voluntary, but the latest draft makes them mandatory.
The mandatory climate targets from financial year 2027 to 2028 will have to be fixed by the banks and will include “information about the performance against each climate-related target and an analysis of trends or changes in the regulated entity’s performance”-The Straits Times
