Skip to main content
Entire section Custom print Text Only Rich Text Print

Principle 6 – Incorporation of climate-related financial risks into capital and liquidity adequacy processes

6.Relevant financial firms should incorporate material climate-related financial risks in their internal capital and liquidity adequacy assessment processes.
 
6.1Relevant financial firms should develop processes to evaluate the liquidity, capital and solvency impact of climate-related financial risks that may manifest within specified time horizons.
 
6.2As part of their internal capital and liquidity adequacy assessment processes, relevant financial firms should consider climate-related financial risks that may impact their capital and liquidity positions over relevant time horizons (e.g., through their impact on traditional risk categories).
 
6.3For those financial firms required to complete an Internal Capital Adequacy Assessment Process (ICAAP), an Internal Liquidity Adequacy Assessment Process (ILAAP), an Own Risk and Solvency Assessment (ORSA), or a similar process, climate-related financial risks should be incorporated into these frameworks to consider and record any material impact on capital and liquidity adequacy.