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The Joint Committee on Climate Change (JC3) held its fourth meeting on 24 February 2021 to discuss its priorities for 2021 in supporting the financial industry’s response to climate-related risks. JC3 recognises the urgency for the financial institutions in Malaysia to accelerate efforts to manage these risks.
In 2020, the JC3 sub-committees completed a number of key initiatives, including the broad-based consultation and pilot implementation of the Climate Change and Principles-Based Taxonomy (CCPT) developed for the financial institutions, a stock-take on disclosure practices of selected financial institutions in Malaysia against recommendations of the Taskforce on Climate-related Financial Disclosures (TCFD) and a gap analysis on the green finance landscape. Financial institutions licensed by BNM will begin capturing exposures based on the CCPT for internal risk management and supervisory purposes over the course of 2021.
The JC3, together with its knowledge partners also developed and organised several foundational and outreach programmes in 2020, as part of its holistic approach in building the industry’s capacity and raising awareness of relevant stakeholders on climate change, its impact and need for climate actions.
For 2021, JC3 will build on these initiatives to further strengthen the financial industry’s capacity in managing climate-related risks, and enhance its role in scaling up green finance. The Committee’s priorities include:
JC3 further agreed to establish a dedicated data workstream to identify crucial climate and environmental-related data and the relevant data sources, as well as solutions to bridge the data gaps. The work of the data workstream will also contribute towards more consistent implementation of the CCPT.
Further to earlier commitments made to work towards wider adoption of TCFD recommendations, JC3 members are stepping up efforts to implement TCFD disclosures in phases beginning this year. Members also agreed to identify specific business initiatives that support sustainable activities and pursue the adoption of internal financial targets for sustainability-related loans and financing, and assets under management.
Bank Negara Malaysia
Securities Commission Malaysia
25 February 2021
About the JC3
The JC3 is a platform established in September 2019 to pursue collaborative actions for building climate resilience within the Malaysia financial sector. The JC3 is co-chaired by Jessica Chew Cheng Lian, Deputy Governor Bank Negara Malaysia and Datuk Zainal Izlan Zainal Abidin, Deputy Chief Executive Securities Commission Malaysia with members comprising senior officials from Bursa Malaysia and 19 financial industry players as well as relevant experts. The JC3’s initiatives and priorities are undertaken by its four sub-committees, namely Risk Management; Governance and Disclosure; Product and Innovation; and Engagement and Capacity Building.
Bank Negara Malaysia
25 Feb 2021
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