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OJK issues the Climate Risk Management & Scenario Analysis (CRMS) 2024

March 4 – The Financial Services Authority (OJK) has issued a Climate Risk Management & Scenario Analysis (CRMS) guideline for the banking sector in managing climate management risks.

CRMS is an integrated framework that includes aspects of governance, strategy, risk management and disclosure to assess the resilience of bank business models and strategies in facing climate change in the short, medium and long term.

The initiation of guidance development related to climate risk management in Indonesia itself has been started since 2023 through the issuance of initial guidance which is further developed to be more comprehensive as outlined in the 2024 CRMS Guideline document.

The preparation of the CRMS Guide has taken into account common practices and international standards which are adapted to the Indonesian context and national interests. By standardizing the climate risk management framework, establishing scenarios and a uniform methodological framework, and supported by data sources and references, the CRMS guide is expected to help banks measure the impact of climate on their business performance and sustainability. This CRMS guide will be updated regularly in accordance with global policies direction, best practices in the financial industry and stakeholder demands.

To view the Climate Risk Management & Scenario Analysis, click here.