International group responsible for addressing climate change suspends efforts due to disagreements among participating countries.
The Financial Stability Board (FSB), an international body that monitors and makes recommendations about the global financial system, has paused integrating climate change policy initiatives into its supervisory and regulatory work. This decision, announced on July 18, 2025, has sparked concerns about the future of global cooperation on climate issues.
The FSB's move comes after a year of heated discussions, with some members advocating for more work on climate-related risks, while others believe the work completed to date is sufficient. The FSB's report on climate-related financial risks, released in 2025, focuses on physical risks and insurance coverage, but does not delve into the use of macroprudential tools.
In 2024, the FSB warned that regulators are overlooking nature-related risks, a concern that has not been addressed in the latest report. The report also does not mention the use of the term "transition plans," a strategy that has gained traction in many member countries.
The FSB's decision to pause its climate change policy initiatives has been criticised by Julia Symon, head of research and advocacy at Finance Watch. Symon stated that the FSB's retreat indicates the limitations of global cooperation initiatives and jeopardizes efforts to prevent a global crisis. She also criticised the FSB for closing the door on a timely and coherent global regulatory response to climate risk.
The Federal Reserve has already left the Network for Greening the Financial System (NGFS), a central bank climate group, adding to the concerns about the future of global cooperation on climate issues. The work on transition plans will now be carried forward by the NGFS, which operates on voluntary cooperation and does not have a formal mandate as a standard-setter.
The search results do not provide explicit information on which G20 countries are actively involved in advancing climate protection policy initiatives within the work of the FSB. However, the FSB's report on climate-related financial risks reveals a "wide range of views" among member countries, suggesting that not all countries are in agreement on the importance and urgency of climate change policy initiatives.
Geopolitical tensions also pose a challenge to global cooperation on climate issues. Symon's statement highlights this issue, stating that geopolitical tensions jeopardize efforts to prevent a global crisis.
Despite the FSB's pause on climate change policy initiatives, work on these topics is continuing in many member countries. Potential initiatives could include information sharing, vulnerability analysis, and supervisory and regulatory work. The FSB has stated that it will consider potential climate-related projects yearly and make determinations about which projects to undertake.
The FSB's retreat showcases the challenges in addressing climate change through global cooperation. However, it is hoped that continued discussions and collaboration among member countries will lead to a more coherent and timely response to climate risk in the future.
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