Bank Transition Disclosure

The Climate Bonds Initiative's guide outlines a comprehensive framework for bank transition disclosures, focusing on the decarbonisation of banking books. It establishes best practices across six key areas: commitment, baselines and targets, delivery strategy, aspects beyond emissions, governance, and reporting. The guidance emphasizes the need for banks to disclose both financed and facilitated emissions, benchmark trajectories against credible sectoral pathways, and implement specific phase-out dates for misaligned activities like unabated coal and new oil and gas exploration. It also integrates requirements for just transition principles and climate resilience, while urging alignment between transition plans and formal financial reporting to ensure credibility.

• The guidance recommends that globally operational banks publicly commit to aligning their banking books—including on- and off-balance sheet, financed, and facilitated emissions—with pathways consistent with a maximum temperature rise of 1.5°C above pre-industrial levels by 2100, with low or no overshoot.
• Banks are encouraged to disclose absolute emissions reduction trajectories and related financial exposure for every high-emitting sector that is financially material (defined as accounting for at least 1% of total credit or revenue exposure, or 2% for sector clusters).
• The guide sets prescriptive phase-out requirements for misaligned activities: banks should stop financing new coal capacity and new oil and gas field exploration/development from 2025, and phase out unabated thermal coal by 2030 in OECD countries and 2040 elsewhere.
• Best practice for delivery strategies includes applying financing conditions to high-emitting sectors to keep clients on 1.5°C pathways, such as requiring transition plans that include methane abatement targets for the oil, gas, and agriculture sectors.
• The framework requires banks to address the social and environmental dimensions of the transition by disclosing how just transition principles are integrated into decarbonisation strategies and how they manage exposure to adaptation and resilience risks.
• To ensure governance and credibility, the guidance recommends that banks link C-suite remuneration to the progress of emissions reduction targets and ensure the transition plan is reviewed at least every five years.
• The guide emphasizes that transition plans must be consistent with annual financial reporting, including the disclosure of quantitative climate-related assumptions used in financial statements, such as those for impairment testing.

APA

Creed, A., & Martini, M. (2025). Bank Transition Disclosure. Climate Bonds Initiative. https://www.climatebonds.net/files/documents/CBI-Bank-Transition-Disclosure.pdf

Chicago

Creed, Anna, and Mireille Martini. Bank Transition Disclosure. Climate Bonds Initiative, 2025. https://www.climatebonds.net/files/documents/CBI-Bank-Transition-Disclosure.pdf.

Wikipedia

{{cite report |last1=Creed |first1=Anna |last2=Martini |first2=Mireille |title=Bank Transition Disclosure |publisher=Climate Bonds Initiative |date=June 2025 |url=https://www.climatebonds.net/files/documents/CBI-Bank-Transition-Disclosure.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{creed2025bank, author = {Creed, Anna and Martini, Mireille}, title = {{Bank Transition Disclosure}}, institution = {Climate Bonds Initiative}, year = {2025}, month = jun, url = {https://www.climatebonds.net/files/documents/CBI-Bank-Transition-Disclosure.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }