Skip to content
  • MyNewMarkets.com
  • Claims Journal
  • Insurance Journal TV
  • Academy of Insurance
  • Carrier Management
Insurance Journal - Property Casualty Industry News

Featured Stories

  • Lengthy Government Shutdown to Impact Insurers
  • FEMA, Customs and Border Protection Staff Data Stolen
  • Articles
  • Jobs
  • Markets

Current Magazine

current magazine
  • Read Online
  • Subscribe
  • Login
  • Front Page
    • National
    • International
    • Most Popular
    • Magazine
    • Forums
    • Blogs
    • Videos/Podcasts
    • Newsletters
  • News
    • Most Popular
    • National
    • International
    • East
    • Midwest
    • South Central
    • Southeast
    • West
  • Magazines
  • Research
  • Directories
  • Jobs
  • Features
    • Events
    • Forums
    • Market Directories
    • Quotes
    • Polls
    • Rankings & Awards
    • Insurance Giving Back
  • Subscribe

EU Bank Regulator Tightens ESG Rules as Climate Risk Grows

January 9, 2025
Email This Subscribe to Newsletter
  • Article

Europe’s financial regulator for banks said lenders in the bloc must regularly and comprehensively measure ESG risks, in new guidelines designed to shore up the industry amid growing threats to financial stability from environmental and social factors.

“ESG risks, in particular environmental risks through transition and physical risk drivers, pose challenges to the safety and soundness of institutions and may affect all traditional categories of financial risks to which they are exposed,” the European Banking Authority said in a statement on Thursday.

Banks should employ scenarios to identify, prepare for and mitigate potential risks from individual exposures as well as at a portfolio level and across industrial sectors, the EBA said. Particular consideration should be given to the fossil fuel industry, and measures should include quantitative targets for financed emissions.

EU Seeks to Streamline ESG Regulations Amid Growing Backlash

The guidelines come as fresh data shows insured losses globally from natural catastrophes were more than double the 30-year average last year, with raging fires in Los Angeles suggesting more damage in 2025. At the same time, banks like other businesses increasingly face legal risks as climate activists leverage the courts.

Meanwhile, there’s a growing divide in how US and European banks tackle climate change. In the US, Wall Street’s biggest lenders just quit the Net-Zero Banking Alliance, while lenders from Europe say they remain committed.

Regulators and policymakers in Europe have been tightening requirements for disclosing and preparing for potential ESG risks. In its new guidelines, which have been months in the making, the EBA said banks should look at least 10 years into the future, assess customers’ dependency on fossil fuels, and review their net zero transition plans.

Banks should also report the potential financial risk impact from clients that aren’t aligned with net zero emissions by 2050; consider the amount of capital they need to absorb losses; and be prepared for environmental-related litigation risks, the EBA said.

Photograph: A street blocked by mud and flood debris following extreme flooding in Paiporta, Spain, in November 2024; Photo credit: Angel Garcia/Bloomberg

Related:

  • Insured Losses From Natural Disasters Hit $140B as Climate Change ‘Shows Its Claws’
  • Companies Walk ESG Tightrope, Under Fire From All Sides Over Disclosures
Copyright 2025 Bloomberg.

Topics Europe Climate Change

Was this article valuable?

Thank you! Please tell us what we can do to improve this article.

Thank you! % of people found this article valuable. Please tell us what you liked about it.

Here are more articles you may enjoy.

Allstate Promotes Rizzo to COO, Merten to President of Property-Liability
Acrisure to Lay Off 400 Employees, Citing Tech Advancements and AI Integration
September Marks Rare Absence of Hurricane Landfalls in US
US Tariffs on Heavy Truck Imports to Begin Nov. 1, Says Trump

Interested in Climate Change?

Get automatic alerts for this topic.

Email This Subscribe to Newsletter
  • Categories: International & Reinsurance NewsTopics: environmental social and governance (ESG) criteria, ESG regulation, EU climate change, EU ESG rules, net zero Banking Alliance (NZBA)
  • Have a hot lead? Email us at newsdesk@insurancejournal.com
More News
French Wine Output to Fall Below 2024 After Fires Ravage Vines
Musk’s X Settles Ex-Twitter Executives’ $128 Million Severance Pay Lawsuit
Survey: Employer, Employee Views Differ on Workplace Safety
Drone Attacks Are Now Seen 2,000 Kilometers Inside of Russia
More News Features

Read This Next

  • EU Bank Regulator Tightens ESG Rules as Climate Risk Grows
  • Correction: Mass. Appeals Court Revives Fired Employee's Religious Claim Over Vaccine Refusal
  • FAIA Bans Live Animal Displays After PETA Concerns About June Convention
  • Connecticut Settles But Wrongful Death Suit Over Murder of Visiting Nurse Goes On
  • Hong Kong Boosts Flood Management as Climate Change Fuels Heavy Rains

Insurance Jobs

  • Customer Service Agent – Personal Lines - Bethlehem, PA
  • Senior Insurance Agent (3+ Yrs P&C Exp | W-2 | Warm Leads | In-Office Only) Senior Insurance Agent (3+ Yrs P&C Exp | W-2 | Warm Leads | In-Office Only) - Westminster, CO
  • Claims Manager, Insurance & Risk Management - Queens, New York
  • Auto Good Hands Repair Network – Performance Consultant – Remote (MST/CST) - Remote?, IL
  • Construction Surety Underwriter / Financial Analyst - Charlotte, NC
MyNewMarkets
  • How to Attract the Next Generation to Insurance
  • 5 Evolving Trends Shaping Architects and Engineers Coverage
  • Rethinking Assault & Battery Liability in Commercial Real Estate
  • From Golf Greens to Sausage Fests: The Wild World of Prize Insurance
  • As Schools Prepare to Pay Athletes, What Role Will Insurance Play?
Claims Journal
  • Engle Martin Acquires London-Based Integra Technical Services Claims Adjusters
  • Musk Settles Suit by Ex-Twitter CEO Over Denied Severance Pay
  • Toyota Explores Small Drone System for Off-Road Vehicle Use
  • New York City Sues Social Media Companies for Allegedly Addicting Children
  • Survey Shows Homeowners Warming to DIY Digital Claims, Insurance Processes
Academy of Insurance education
  • October 9 Forward Into The Past: Certificates of Insurance, Additional Insureds, and Other Contractual Risk Transfer Issues
  • October 16 Auto Insurance: You Get What You Pay For
  • October 23 Gotchas That'll Getchya - Latest Policy Language That'll Get You Sued
  • October 30 Challenges in Agency Mergers – Reducing Staff Flight and Avoiding E&O Claims

Insurance News

  • News by Region
  • News by Topic
  • Yesterday

Site Search

Features

  • Insurance Markets Directory
  • Forums
  • A.M. Best Company Ratings
  • Industry Events
  • Agencies For Sale
  • Newswire
  • Insurance Jobs
  • Rankings & Awards

Connect with us

  • Email Newsletters
  • Magazine Subscriptions
  • For Your Website
  • RSS Feeds
  • Twitter
  • Facebook
  • LinkedIn
  • Do Not Sell My Info

Insurance Journal

  • Submit News
  • Advertise
  • Subscribe
  • Reprints
  • Link to Us
  • Contact Us

Wells Media Group Network

  • Insurance Journal
  • MyNewMarkets.com
  • Claims Journal
  • Insurance Journal TV
  • Academy of Insurance
  • Carrier Management
© 2025 by Wells Media Group, Inc. Privacy Policy | Terms & Conditions | Site Map