Guidelines on Environmental Risk Management for Banks approved

26-07-2024

26 July 2024, Baku: The Central Bank continues implementing the Sustainable Finance Roadmap (2023-2026) aimed at transforming the financial sector into sustainable finance. One of the next initiatives implemented in this direction is related to integrating climate and other environmental risks into banks' risk management systems. In this regard, the document "Guidelines on Environmental Risk Management for Banks" was approved by the decision of the Management Board of the Central Bank of the Republic of Azerbaijan dated July 11, 2024. The Guidelines have been developed on the basis of the international standards, the advanced international practice and the specifics of the local banking sector. The main purpose of the Guidelines is to ensure the integration of climate and other environmental risks into the risk management system of banks and to increase their resilience to these risks.

The Guidelines, which are recommendatory in nature, will contribute to the implementation of the Central Bank's policy on the transition to sustainable finance.

Guidelines on Environmental Risk Management for Banks