Climate Finance Policy Engagement Analysis
Climate Lobbying Overview: The Institute of International Finance (IIF) has communicated top-line support for climate action but has cautioned against a prescriptive approach to regulatory action on the financial sector in this area, engaging especially against climate disclosure policy and the incorporation of climate factors into risk management/prudential regulation.
Top-line Messaging on Climate-Related Financial Policy: IIF has downplayed both the risk that climate change poses to financial stability and the role of the financial sector in addressing climate change. In 2023 comments to the International Association of Insurance Supervisors (IAIS), IIF asserted that there is “insufficient evidence” of a near-term material threat of climate-related financial risks. In a 2023 report, IIF supported urgent action to tackle climate change but emphasized that policy changes should occur in the real economy rather than the financial system. In a 2024 position paper IIF appeared to question the "finance-centric" theory of change for delivering the net-zero transition, asserting that reforms should occur in the real economy rather than the financial sector, and appeared to suggest that concerns regarding climate risk and the financial system are overblown.
Position on Regulated Corporate Climate Disclosure: IIF has consistently opposed Scope 3 mandates in disclosure policies globally. In a 2023 report IIF stated broad support for the global climate reporting standards developed by the International Sustainability Standards Board (ISSB), but in its comments on the proposal a year earlier, IIF had numerous objections, including around Scope 3 emissions and transition plan disclosures. However, in a June 2023 press release IIF supported the final ISSB standards, and in September 2023 comments to the Board the IIF encouraged widespread adoption of the standards. According to a September 2023 Financial Times article, IIF was unsupportive of the Scope 3 disclosure requirement in a California greenhouse gas emissions disclosure bill. IIF has also opposed the Scope 3 disclosure requirements in the EU Corporate Sustainability Reporting Directive (CSRD) and also encouraged its delayed implementation in a February 2025 response to the European Commission. In an April 2025 position paper IIF again supported the rollback and delayed implementation of climate disclosure standards as part of the EU Omnibus package and also advocated that transition plan requirements under the Corporate Sustainability Due Diligence Directive (CSDDD) should not include an expectation of 1.5C alignment. In a May 2025 European Financial Reporting Advisory Group (EFRAG) consultation response, IIF advocated for the watering down of the European Sustainability Reporting Standards (ESRS) and opposed the inclusion of lobbying disclosures.
Position on Taxonomies: IIF has called for fewer EU Taxonomy-related reporting requirements,, advocating for the removal of the Green Asset Ratio in both February 2025 and May 2025 consultation responses.
Position on Climate Standards, Labels, and Benchmarks and ESG Ratings: IIF, in a 2024 response to a European Insurance and Occupational Pensions Authority (EIOPA) consultation, opposed the need for greenwashing regulation for insurance products, arguing that current regulations are sufficient and characterizing EIOPA's definition of greenwashing as "overbroad". Similarly, in a 2024 IAIS consultation on climate risk market conduct issues, IIF opposed the need for greenwashing regulation for insurance products and appeared to emphasize that action instead should be society-wide.
Position on Incorporating Climate Factors Into Investor Duties: In a 2024 IAIS climate risk consultation, IIF did not support supervisors establishing "prescriptive regulatory investment requirements" to include climate factors in decision making, and asserted that investment decisions are the responsibility of the board and senior management. In a 2025 EU Omnibus consultation, IIF advocated for the inclusion of the Sustainable Finance Disclosure Regulation (SFDR) in the Omnibus simplification mechanism, which would effectively decrease the scope of SFDR reporting.
Position on Incorporating Climate Factors Into Risk Management/Prudential Regulation: IIF appears unsupportive of specific actions to incorporate climate risk into financial regulation or supervision. In a 2024 position paper IIF stated its opposition to a "punitive" approaches to climate risk and transition supervision, suggesting that financial institutions are already accounting for climate risk in their risk management processes and thus regulatory or supervisory intervention is unnecessary.
IIF has also engaged on consultations at the Basel Committee for Banking Supervision (BCBS), which develops standards and guidelines that are likely to inform government policy. In 2024 1546114 comments to the BCBS, IIF did not support incorporating information around banks’ climate strategy, emissions, and physical risk exposures into Pillar 3 disclosure requirements, which are intended to address financial risk and capital adequacy. While IIF, in a July 2024 consultation response, supported the BCBS’s efforts to develop guidance around Climate Scenario Analyses (CSA), it cautioned against the use of CSA for specific risk management steps, including directing banks to adopt climate-related lending limits.
IIF has also consistently opposed standard setters’ efforts to address climate-related insurance risk at the International Association of Insurance Supervisors (IAIS). In a February 2024 response, IIF highlighted the limitations of climate risk scenario analysis and appeared to suggest that climate risks are not material to all insurers. In 2024 1572344 comments to the IAIS, IIF cautioned against elevating climate risks above other risks in guidance around the role of board and management.
IIF has also opposed the inclusion of climate factors in EU risk and prudential regulation. In a 2025 response to the EU Commission, IIF cautioned against “demanding and punitive supervisory requirements” and in response to a 2025 EIOPA consultation, IIF did not support EIOPA's proposed standards specifying the content of sustainability risk plans under Solvency II, describing the proposals as "overly complex, prescriptive and insufficiently risk-focused". IIF also advocated for the EU to bring financial sector prudential and supervisory frameworks around ESG risks into its Omnibus review process in an April 2025 position paper.
Position on Real Economy Climate Policy: IIF appears to have limited engagement on real economy climate policies. In a September 2024 website article IIF supported the need for carbon pricing and energy efficiency standards.
Position on Energy, Industry, and Land Transitions: InfluenceMap has not found extensive evidence of IIF engaging on specific policy to transition energy, industry, or land. In a 2023 report on the role of the financial sector in the net zero transition, IIF emphasized the need for government regulation to achieve real economy emissions reduction. It outlined support for policy to incentivize development of zero-carbon infrastructure, removal of fossil fuel subsidies, and specific decarbonization frameworks including the US Inflation Reduction Act (including its clean energy tax credits), the EU Net Zero Industry Act, and the Japan GX Policy. However, in minutes from a meeting between IIF and the European Commission in 2023, obtained by InfluenceMap via FOI request, IIF appeared supportive of continued investment in unabated fossil gas, which is not aligned with IPCC guidance on the role of fossil gas in the energy mix up to 2050. In a 2024 podcast however, IIF appeared to support government action to transition away from fossil fuels and increase renewables in the energy mix and in a 2025 EU Commission consultation response, IIF advocated for the EU to deliver industrial decarbonization policies.