Sustainable Banking Finance Network (SBFN) Measurement Framework
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The SBFN Measurement Framework is an assessment tool used to evaluate a country’s sustainable finance framework. It consists of 11 cross-cutting indicators that are further broken down into underlying datapoints. The framework evaluates the clarity, depth, and alignment with international good practice across three pillars: ESG Integration, Climate Risk Management, and Financing Sustainability.
Key Components of the Framework
Pillars
The SBFN Measurement Framework assesses a country’s sustainable finance framework across three pillars:
- ESG Integration: Evaluates how environmental, social, and governance (ESG) risks are integrated into financial decision-making.
- Climate Risk Management: Assesses a country’s ability to manage climate-related risks.
- Financing Sustainability: Evaluates the role of financial institutions in financing sustainable development.
Cross-Cutting Indicators
The framework consists of 11 cross-cutting indicators that are further broken down into underlying datapoints. These indicators cover various aspects of a country’s sustainable finance framework, including:
Strategic Alignment
- National Framework (2 indicators)
- Has the regulator or industry association published a national framework for the banking sector?
- Has the relevant regulator or industry association published a framework for capital markets, investment, insurance, or other non-lending FIs?
- Alignment with International Goals and Standards (3 indicators)
- Is the country’s sustainable finance framework aligned with international goals and standards?
- Does the country have a clear roadmap to implement international best practices?
- Are there any national initiatives to promote sustainable finance globally?
- Alignment with National Goals and Strategies (4 indicators)
- Is the country’s sustainable finance framework aligned with its national development strategy?
- Does the country have a clear plan to integrate ESG considerations into its national development goals?
- Are there any national initiatives to promote sustainable finance in key sectors?
Regulatory and Industry Association Actions
- Overall Approach and Strategy (8 indicators)
- What is the overall approach of the regulator or industry association towards promoting sustainable finance?
- Does the country have a clear strategy for implementing sustainable finance practices?
- Are there any national initiatives to promote sustainable finance in key sectors?
- Technical Guidance (10 indicators)
- Has the regulator or industry association published guidelines on ESG risk management and disclosure?
- Are there any national initiatives to promote sustainable finance in key sectors?
- Are there any national initiatives to support the development of sustainable finance capabilities?
- Supervision Activities and Incentives (11-13 indicators)
- What is the level of supervision and oversight of financial institutions’ ESG risk management practices?
- Are there any incentives for financial institutions to adopt sustainable finance practices?
- Are there any national initiatives to promote sustainable finance in key sectors?
Expectations of Financial Institution (FI) Actions
- Strategy and Governance (15 indicator)
- Does the FI have a clear strategy for integrating ESG considerations into its business operations?
- Is the FI’s governance structure aligned with its sustainability goals?
- Organizational Structure and Capacity (16-18 indicators)
- What is the organizational structure of the FI, and how does it support sustainable finance practices?
- Does the FI have a dedicated team for ESG risk management and reporting?
- Policies and Procedures (19-20 indicators)
- Are there clear policies and procedures in place for ESG risk management and disclosure?
- Are there any national initiatives to promote sustainable finance in key sectors?