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Climate-related disclosures: governance and metrics for foreign reserves portfolios in euro area central banks

By Dr. Deimantė Vasiliauskaitė | January 30, 2026
Business Insights | Case Studies | Economics and Finance | Research Reviews

The initiation of the Task Force on Climate-related Financial Disclosures (TCFD) by the Financial Stability Board (FSB) in December 2015 (Task Force on Climate-related Financial Disclosures, 2017) represented a significant industry-led move to foster climate-related disclosures that would inform decisions in investments, lending, and insurance underwriting processes. The objective was to provide stakeholders with a more transparent view of carbon asset concentrations and the financial sector’s vulnerability to climate change risks. Access to reliable data is the starting point for addressing climate change. Accurate data is critical for assessing the influence of central banks on the climate and understanding the associated risks. This essential information paves the way for central banks to implement meaningful and practical actions.


The reporting by central banks offers detailed insights into the carbon footprint and climate-related risks tied to the assets managed by the European Central Bank (ECB) and the national central banks of the euro area, collectively referred to as the Eurosystem. This improved transparency facilitates a more nuanced understanding of their portfolios’ impact on the climate, thereby enhancing the decision-making process concerning the climate goals of central banks and aiding others in comprehending climate-related risks and impacts.


Beginning in 2023, the European Central Bank (ECB) and the Eurosystem central banks have pledged to release climate-related financial disclosures annually. These disclosures demonstrate their initiatives to reduce carbon emissions from their portfolios following the objectives set by the Paris Agreement. Additionally, these disclosures act as instruments to track their advancement and guide any required modifications to their strategies.
Eurosystem central banks’ initiatives significantly enhance openness and responsibility in how financial institutions manage and disclose climate risks. Concentrating on non-monetary policy portfolios is crucial, given their significant potential environmental impact. The yearly frequency of these disclosures enables continuous oversight and adaptation, addressing the dynamic nature of climate-related challenges and policy goals. This movement is part of a broader global shift towards incorporating environmental factors into the financial industry, aligning with international frameworks such as the Paris Agreement.


The Task Force’s guidelines are organized into four key themes representing fundamental aspects of organizational operations—governance, strategy, risk management, metrics, and targets.


This research aims to evaluate how central banks disclose governance and metrics based on TCFD recommendations.

Key Findings

Detailed Analysis

This analysis includes a literature review and a case study of 20 euro area central banks. Climate risks in central banking are very relevant in academics and practice. Firstly, this research uses a literature review based on bibliometric analysis using the Web of Science Core Collection. Based on research results for keywords: “climate risk, central bank,” 342 documents have been found. A software tool VOSviewer, was used for constructing and visualizing bibliometric networks.

Figure 1. Co-occurrence, All keywords, a minimum number of occurrences of a keyword 5, detected 75 keywords, formated 5 clusters.

In Figure 1 co-occurrence of keywords represents the frequency with which specific terms appear together in Web of Science Core Collection documents. This analysis shows that in the topic of climate risk in central banking climate change concept plays a key role. At the same time, from a time line perspective, climate risk issues are becoming more relevant in monetary policy and financial stability areas. Governance in climate risk is not a new topic, but we still see a lack of research for climate risk disclosure challenges.

Figure 2. The most cited authors, based on the rules: minimum number of documents of an author 1, minimum number of citations of an author 100, 36 items connected in a network, WoS database.

Figure 2 shows the most cited authors in the field of climate risk in central banking and their cooperation. Those who had no connections in the network were eliminated. The most cited author who has no connections in the network was Dafermos Yannis, who, together with other colleagues, focused on climate risks and financial stability (Battiston, Dafermos, and Monasterolo 2021).

Figure 3. The most cited documents, based on the rules: minimum number of citations of a document 25, WoS database, 74 meet the threshold.

In Figure 3, we can see the most cited articles about climate risk in central banking. Campiglio et al. (2018) have analyzed the climate change challenges for central banks. Battiston et al. (2017) focused on the climate stress test of the financial system. Chenet, Ryan-Collins, and van Lerven (2021) investigated climate-related financial risks and discussed different approaches to financial policy. Fatica, Panzica, and Rancan (2021) analyzed the pricing of green bonds at the financial institutions level. The topic of climate risk and financial stability was analyzed by Roncoroni et al. (2021). Dikau and Volz (2021) researched central bank mandates, sustainability objectives, and the promotion of green finance. However, there is no research on climate-related information disclosure among these most cited articles.

In this research, 20 central banks of the euro area were analyzed in order to identify how these central banks disclose climate-related information based on TCFD recommendations for governance and metrics.

Figure 4. The results of governance disclosure in euro area central banks absed on TCFD recommendations

Figure 4 presents the analysis of 20 euro area central banks’ reports on sustainable investments and climate-related risks. The results show that reports are not very transparent, as we see a lot of information that central banks do not disclose.

Figure 5. Metrics used to assess and manage relevant climate-related risks and opportunities in euro area central banks

In Figure 5 are the results of metrics discloused by euro area central banks. The required metrics are only three: weighted average carbon intensity (WACI), total carbon emissions, and carbon footprint. Two extra metrics are disclosed in half of all central banks: green and thematic bond share and carbon intensity.

Other measures are disclosed only in some banks. From the reports it was clear that central banks tend to disclose more metrics next year, so the results for 2023 can be better with more efforts for disclosing information.

Implications for Businesses

The main recommendation for central banks would be to report more transparent disclosures in governance, focusing on TCFD recommendations. Processes and frequency by which the board and/or board committees (e.g., audit, risk, or other committees) are informed about climate-related issues are very important to ensure the right climate risk management in the organization. The other aspect for central banks is to have a clear monitoring of climate related issues system.

The other recommendation is to include more measures than the minimum in disclosing climate-related risks and opportunities and present it clearly by explaining the calculation and targets for the future.

Conclusions

References