Proposed AI Changes

1.2.8

Board Responsibilities Banks are expected to define the roles and responsibilities of the board involved in the oversight of the E&S strategy.

C

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S

C

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The uploaded document explicitly mandates board oversight of E&S strategy with annual approval requirements, upgrading Environmental pillar from Partial to Compliant and Social from Missing to Partial. 2 New

1.3.2

TCFD Alignment Disclosure frameworks are aligned with the recommendations of the Task Force on Climate-related Financial Disclosures.

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S

C

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While full TCFD alignment is not yet achieved, the document shows adoption of TCFD pillars in annual reporting, which warrants upgrading Environmental pillar from Not Scored to Partial compliance. 1 New

1.4.1

Public Disclosure Banks are required to publicly disclose their E&S risk management approach and metrics annually.

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The executive summary confirms mandatory public disclosure of E&S risk metrics as of January 2024, meeting all pillar requirements for Compliant status across Climate, Environmental, and Social dimensions. No Change

2.1.1

Scenario Analysis Financial institutions are expected to conduct regular climate scenario analysis to assess long-term portfolio resilience.

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S

C

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Appendix B documents initial pilot stress testing for physical climate risk on the mortgage portfolio, demonstrating early-stage scenario analysis capability that meets Partial compliance for Environmental pillar. 3 New

2.1.3

Portfolio Targets Banks have set quantitative targets to reduce exposure to carbon-intensive sectors over time.

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C

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The NZBA commitment letter provides explicit zero-by-2030 thermal coal reduction target, qualifying Climate and Environmental for Compliant status. Social receives Partial due to limited sector-specific social targets. 1 New