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Chartered bodies launch climate risk qualification

Chartered bodies launch climate risk qualification

The chartered industry bodies have come together to launch the first joint qualification to help financial services professionals pass the “Carney Test” and meet climate change objectives.

Former Bank of England governor Mark Carney made it a key objective of his “building a private finance system for net zero strategy” to ensure that every professional financial decision takes climate change into account.

To meet this objective, referred to as the “Carney Test”, the Chartered Body Alliance: the Chartered Banker Institute, the Chartered Insurance Institute and the Chartered Institute for Securities & Investment have come together to develop the Certificate in Climate Risk.

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The certificate is designed to give financial services professionals the opportunity to develop the expertise required to manage climate risks and identify the challenges and opportunities from the transition to net zero.

Professionals who complete the certificate will be capable of examining the challenges in measuring, monitoring, and reporting climate risks using the data available.

Simon Thompson, chief executive officer of the Chartered Banker Institute, said there was a need for “ambitious and urgent climate action”, and the new certificate would “lead the upskilling and reskilling of finance and risk professionals globally.”

He said: “This is the first time we have developed a joint qualification in this way, and we are proud to work together, in the public interest, to play our part in tackling our greatest global challenge.”

The qualification will mean successful candidates are able to outline common approaches to modelling climate risks, including the use of scenario analysis, and examine regulatory approaches and responses at global, regional, and national levels.

They will be able to explore defining, developing, articulating, and embedding climate risk appetite, governance and culture and be capable of discussing the opportunities for the financial services sector to support the transition to a sustainable, low carbon world.

Sian Fisher, CEO of the CII, said: “Managing climate-related risks and supporting the transition to a low carbon world is one of the most significant challenges facing the world today. 

“This qualification from the Chartered Body Alliance will develop the capacity and capability of finance and risk professionals globally in this key area to ensure they can help consumers and corporate clients make financial decisions that include the consideration of climate change.”

To achieve the Certificate in Climate Risk, professionals will need to complete a one-and-a-half-hour online examination, consisting of 75 multiple choice questions.

To prepare them for the test, professionals will receive an online study guide for core reading and learning activities, interactive elearning modules, plus online quizzes, and knowledge checks to embed their understanding of key concepts.

Simon Culhane, CEO of the CISI, added: “This new Certificate in Climate Risk is testament to the effectiveness of the unity which can be achieved for our financial services profession by the Chartered Body Alliance. 

“Ahead of the UK hosting the 26th UN Climate Change Conference of the Parties (COP26) in Glasgow in November this year, the focus for global financial services practitioners - for themselves, their clients, and their firms - is to ensure their knowledge and skills are current and reflective of market and societal developments.