Basel Committee Releases Voluntary Climate Disclosure Framework for Banks
On June 13, 2025, the Basel Committee on Banking Supervision (BCBS) released its long-awaited framework for the disclosure of climate-related financial risks by banks. While the framework stops short of mandating disclosures, it offers a structured, globally coherent foundation for banks and regulators seeking to advance transparency in climate risk.
The framework allows national regulators to adopt and tailor climate disclosures to their local priorities. Though non-binding, it reflects growing consensus around the importance of integrating climate risk into governance, strategy, and risk management
What’s in the 2025 Framework
First proposed in 2023 as a potential Pillar 3 framework with certain mandatory requirements, the final framework takes a more flexible approach. It emphasizes materiality, alignment with existing standards, and practical feasibility. Key focus areas include:
Governance & Strategy
Disclosures on board and management oversight, risk governance, and strategic integration of climate risks.
Material Sector-Level Data
Banks must report exposures and financed emissions only in sectors deemed financially material, not across all 18 sectors identified by the by the Financial Stability Board’s (FSB’s) Task Force on Climate-related Financial Disclosures (TCFD).
Physical & Transition Risks
Qualitative disclosures on climate-related exposures tied to geography and sector.
Climate Targets
Disclosure of specific, publicly committed portfolio targets—replacing earlier calls for forward-looking forecasts.
Exclusion of Facilitated Emissions
The final framework drops disclosure requirements for emissions linked to capital markets and advisory activities.
These revisions aim to improve consistency and feasibility—but also reflect the political and data-related challenges in building universal climate disclosure standards.
A Constructive but Cautious Step
While the framework is a positive step, its voluntary nature has led some advocacy groups to question its impact—particularly in jurisdictions unlikely to act without regulatory mandates. BCBS emphasized the need for flexibility given evolving data and methodologies.
Still, the framework sets a baseline that could shape future regulation and complements global initiatives like the International Sustainability Standards Board (ISSB) standards. It reinforces the view that climate risk is a financial risk—and that transparency is essential, even if regulatory adoption varies across markets.
To learn more, we encourage you to review the full BCBS framework here.
Why It Matters for Climate-Aligned Bank Investment
The BCBS framework reinforces a key trend: climate-related risk is becoming central to how banks assess credit and investment exposure. For banks engaged in sustainable finance—including solar tax equity—this is an opportunity to align investment strategies with emerging disclosure practices. It’s also a chance to demonstrate leadership in managing climate risk. At Sunwealth, we help banks invest in high-impact, community-based solar+storage projects—generating strong financial returns and measurable climate benefits. Our solar tax equity offering supports climate-aligned investment strategies while advancing clean energy access, green job creation, and energy savings across diverse communities.
Whether your institution is preparing for future disclosure frameworks or looking to diversify through sustainable investments, Sunwealth is here to help you move forward. Schedule a call with our team to explore how solar tax equity can support your institution’s climate strategy.
About Sunwealth
Sunwealth is a clean energy investment firm working to change who has access to renewable energy by changing the way we invest in it. Combining deep experience in solar development and finance with roots in community and impact investing, Sunwealth invests in commercial solar plus projects delivering clean energy and energy savings to communities while providing strong financial returns to investors and community partners. Since 2014, the company has invested over $261 million in 770 community-based solar projects nationwide; the company has delivered targeted returns to investors for over 10 years with no defaults. For five consecutive years, Impact Assets named Sunwealth to its IA50, a leading list of impact fund managers; Environmental Finance awarded Sunwealth its 2023 Award for Innovation – Bond Structure (Social Bond) and named Sunwealth’s Solar Impact Fund its ESG Fixed Income Fund of the Year. Learn more at www.sunwealth.com.