17. Institutions should develop and implement scenario analysis gradually, with the aim of …

Institutions should develop and implement scenario analysis gradually, with the aim of embedding it in their entire management framework (i.e. strategy, governance, risk management and operations). When using scenario analysis to test the resilience to potential negative impacts of environmental factors, institutions should consider the following two complementary tools in accordance with Section 5:

• a. The stress test which can help institutions assess their financial (both capital and liquidity) resilience to environmental shocks in the short-term.
• b. The resilience analysis which should help institutions assess and, where necessary, adapt their business model to ensure its resilience in the face of medium- to long-term environmental shifts. FINAL REPORT ON GUIDELINES ON ENVIRONMENTAL SCENARIO ANALYSIS

1. Overview

1.1 References

1.2 Identified Requirements

1.3 Related Standards

2. Identified Requirements

3. Related Standards

• EBA - Published by the European Banking Authority at https://www.eba.europa.eu/