G20 Central Banks Highlight Data Gaps in Climate Risk Management

Central banks from India, Indonesia, and Brazil convened a virtual roundtable in June 2023 to address the challenges emerging economies face in managing climate-related financial risks. The event, co-organised by the Climate Bonds Initiative, ODI, and auctusESG, preceded the third G20 Finance Ministers and Central Bank Governors meeting under India's G20 Presidency.

Saurav Sinha, Executive Director of the Reserve Bank of India, acknowledged that the forward-looking nature of climate risks — which materialise over longer time horizons than traditional financial risks — makes modelling and data collection especially difficult. He indicated the RBI would prioritise strengthening disclosure and supervisory review under Basel Pillars 2 and 3 before moving to prescriptive capital requirements, with capacity building identified as a critical immediate need. The Central Bank of Brazil has already expanded its climate financial disclosures to include social and environmental dimensions, and has implemented a Sustainable Rural Credit Bureau capturing technical agronomic and land-use data.

Bank Indonesia's Director of Macroprudential Policy, Irman Robinson, stressed the importance of just transition considerations, including the retraining of workers as the economy shifts away from fossil fuels. Indonesia is developing a carbon calculator to help firms quantify emissions and is building an integrated emissions reporting system. The roundtable highlighted that emerging market regulators lag behind their developed-country counterparts in both methodology and supervisory tools, making forums like the G20 critical for knowledge transfer.

Speakers underscored that mobilising green finance in emerging economies depends on three pillars: developing credible green transition frameworks, securing financial institution commitments, and scaling sustainable finance instruments. Green taxonomy-based bonds were cited as a significant opportunity for this capital mobilisation. The G20's Sustainable Finance Technical Assistance Action Plan is expected to include concrete capacity-building recommendations to better coordinate climate and sustainability risk management across G20 members and improve financial flows from the Global North to the Global South.

Key figure — 2.6 — average fully paid home-working days per week reported by Indian respondents in a 27-country study, cited as a factor shifting peak electricity demand