Growth has been fueled by policy shifts, new technologies, and growing corporate momentum. As a result, banks are maturing from a simple understanding of the baseline to exploring with clients the levers to finance reduced emissions in the real economy.
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Regulators are focusing on climate and sustainability. Disclosure-focused regulations and standards will increase rigor and transparency for climate finance and create more potential for banks to identify financing opportunities. For example, in March 2022, the International Sustainability Standards Board (ISSB) circulated draft global climate-related and sustainability-related disclosure standards. The European Union and United Kingdom have also introduced new reporting requirements.
The revenue potential for banks from debt investment in climate finance will average roughly $100 billion annually through 2030, we estimate. This represents approximately 5 percent of total global banking revenue pools (Exhibit 7). 2ff7e9595c
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