Otoritas Jasa Keuangan (OJK), or The Indonesia Financial Services Authority, has recently launched a Climate Risk Management & Scenario Analysis (CRMS) guide for banking sectors.
Awareness of climate change has become more prevalent among financial sector players. With its distinct characteristics, Indonesia has a relatively high vulnerability to climate-induced risks, such as disaster and transitional risks that could hurt national development without adequate mitigation measures. To increase national climate resilience and contribute to the achievement of the Net Zero Emission 2060 commitment, in early March 2024, OJK launched a CRMS as a comprehensive climate risk management guideline. It carries out the latest international climate-related standards and best practices for the financial industry, adapted to the Indonesian context.
By implementing CRMS, banks are expected to be prepared for potential financial impacts due to risks from climate change by including climate risk in Banks’ risk management system. This is important as financial institutions, especially banks, hold the key to the progress of sustainable development and national economic stability.
To discuss further about this new regulation, we are conducting the next Sustainable Talk: OJK CRMS 2024. Contact info@trihita-consulting or m.winata@trihita-consulting if you want to register!
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