The Monetary Authority of Singapore issued three Guidelines on Environmental Risk Management – Transition Planning, setting supervisory expectations for banks, insurers and asset managers on managing climate-related transition and physical risks faced by institutions and their portfolios. The Guidelines supplement MAS’ Guidelines on Environmental Risk Management issued in 2020. Financial institutions are expected to establish a transition planning process in a risk-proportionate manner, reflecting factors such as the risk profile of their business models and local operating circumstances. Core expectations include forward-looking adaptation of business models, governance and risk management practices to assess and manage physical and transition risks, and engagement with customers and investee companies to understand their climate-related risks and how they manage them, with the aim of avoiding indiscriminate withdrawal of credit, insurance coverage or investment. Institutions should also consider the materiality of counterparties when collecting data and keep pace with evolving data, methodologies and capabilities for measuring and managing climate-related risks. The sector-specific Guidelines reflect differing business models and incorporate feedback from earlier public consultation and industry engagement. They take effect from September 2027 following an 18-month transition period.
Monetary Authority of Singapore 2026-03-05
Monetary Authority of Singapore issues transition planning guidelines for banks insurers and asset managers effective September 2027
The Monetary Authority of Singapore issued Guidelines on Environmental Risk Management for banks, insurers, and asset managers to manage climate-related risks. These supplement 2020 guidelines, requiring adaptation of business models, governance, and risk management, and client engagement. Incorporating public feedback, they take effect in September 2027 after an 18-month transition.