Sperare per il meglio (ma prepararsi al peggio): il quadro prudenziale dell’Unione europea per gli scenari climatici “bottom-up”

The paper delves into the legal framework surrounding the use of climate scenarios by banks, particularly within the EU’s prudential supervision framework. It maps the legal obligations to conduct climate scenario analyses against the EU framework transposing Basel III requirements, also considering the recent amendments to the Capital Requirements Regulation (CRR) and Capital Requirements Directive (CRD). It also assesses the role and powers of supervisory authorities, like the ECB, to assess the adequacy of climate scenarios designed by supervised entities. Moreover, the paper explores the relationship between climate scenarios and transition plans, which banks will have to develop both for prudential purposes and for transparency purposes (under the CSRD and CSDDD).