Quantifying Climate Risks and Implementing Climate Stress Testing: A Comprehensive Approach

On-demand

Course Overview

Over 20 jurisdictions are piloting or have implemented climate stress test across the Americas, Europe and Asia to assess the resilience of financial institutions against climate change. It has become crucial for financial institutions across the globe to understand the climate risks inherent across their portfolios, across different climate scenarios, in order to mitigate these risks effectively. Both front office and back office roles of banks need to understand the implications of these climate stress tests so they can adapt risk assessment, product structuring and client engagement in order to manage the risks and opportunities of climate change, while complying with increasing prudential regulation.

This comprehensive course, delivered in partnership with WeESG, explores how climate risk impacts banks' clients and counterparties, and thus banks themselves across the range of climate scenarios that may unfold. Participants will delve into methodologies, assumptions, gaps, and limitations associated with estimating a bank's capital shortfall in the wake of a climate-related shock, as well as review key results from regulatory stress testing exercises. This course will leave participants well-prepared to fulfil their critical roles in effectively mitigating and accurately reporting on climate risk.

Duration: Two half-days (taught material + exercises, case study analysis & Q&A section)

Trainer: Fatima Roudani

Fatima has over 15 years' experience across investment banking.

Most recently, as a Trading Director for HSBC Global Markets, she directed multiple strategic initiatives, working with cross-functional teams globally, in order to optimise the banks' capital requirements in alignment with Basel 3.

Fatima holds an Executive MBA from HEC Paris, specializing on the Energy transition, and a Master of Science in Economics and Applied Mathematics from Ecole Polytechnique (top engineering school in France).

Learning outcomes

Assess the 'physical' impact of climate change and the 'transition' risk to a low-carbon economy at sector and company level.

Analyze how climate litigation cases can impact banks and their clients.

Explore the evolving regulatory landscape that financial institutions face with regards to climate risk.

Identify effective strategies for integrating climate related risks and opportunities within processes of different roles in banks.

Gain an overview of the commercial opportunities available to financial institutions for mitigating risk while supporting clients transition to net zero.

commercial opportunities available to financial institutions for mitigating risk while supporting clients transition to net zero. Understand the key climate stress tests, conducted globally by financial regulators, and the implication of their findings.

Compare key data sources, scenarios and methodologies to conduct climate stress tests