The European Central Bank is planning on imposing financial penalties on businesses that do not comply with the ECB climate risk mitigation recommendations. In 2020, the ECB published recommendations for banks to determine their climate risks and reduce their environmental impact. These recommendations include imploring banks to identify the percentage of carbon-related assets in each of their portfolios. Financial institutions are expected to meet these recommendations by the end of 2024. Many banks failed to meet the interim requirements by March 2023. The Vice President of banking supervision at the ECB, Frank Elderson, stated on November 21st, 2023 that non-compliant banks will have to pay penalties for failure to institute emissions reduction measures.
Governments are increasingly instituting financial penalties for corporations that do not comply with climate change mitigation efforts. The EU has established clear guidelines that corporations need to follow and the recent announcement from Elderson only reinforces that financial penalties will be instituted for non-compliance. Banks need to act now to assess their greenhouse gas emissions and implement measures to reduce their carbon footprint. DitchCarbon can help! Reach out today to understand how DitchCarbon can assist your corporation/bank in mitigating your carbon emissions.