ISO/TC 322 - Sustainable finance

This document specifies requirements and recommendations for strategic transition planning by financial institutions, designed to protect and enhance value by supporting institutions’ response and contribution to a global net zero and climate-resilient economy. The requirements and recommendations are designed to enable financial institutions to develop and maintain transition planning objectives and targets that advance the temperature and resilience goals of the Paris Agreement[23], and establish robust policies and processes to integrate these into their financial activities. This document is applicable to any financial institution, regardless of size, type and geographic location, with a particular focus on banking, insurance and investment institutions. Its provisions are applied in the context of the institution’s particular business model. NOTE 1 Some considerations specific to particular institution types are included in guidance notes. Additional guidance on product attributes specific to different types of financial institution can be found in Annex A. This document is applicable to all financial activities (including lending, insurance, asset owner investing, asset manager investing and capital market activities) that the institution determines it can either control or influence, using a life cycle perspective (e.g. those described in 7.2.2). It can also be applicable to relevant financial activities within real economy institutions and emerging financial institution types, many of which leverage digital technologies and can be subject to different or bespoke regulatory frameworks (e.g. decentralized finance (DeFi) platforms). NOTE 2 This document is intended for global application, recognizing that some financial institutions, including those in some emerging market and developing economies (EMDEs), can face constraints in the local enabling regulatory environment and data availability. It therefore seeks to ensure flexibility and proportionality in application, as appropriate. NOTE 3 Documents on asset management developed by ISO/TC 251, including ISO 55000[18], ISO 55001[19] and detailed guidance in ISO 55002[20], can be useful for financial institution asset management activity, particularly as it relates to alignment of asset management with business objectives (e.g. those related to transition planning).

This document specifies requirements for and gives guidance on the development, embedding, communication, validation and verification of sustainable finance products and services (SFPS). It addresses the product and service areas of lending, asset management, insurance, payment accounts and digital assets. This document is applicable to any organization that intends to provide or is providing SFPS with an integration of defined environmental, social and governance (ESG) aspects and proof of intended impacts. It can be used for aligning existing SFPS or designing new ones. This document enables organizations to define, embed, communicate, attribute and effectively evaluate SFPS. It further enables successful marketing and documenting of SFPS objectives, properties and impacts, as well as validation and verification.

This document gives guidance to organizations on the application of overarching sustainability principles, practices and terminology for financing activities. It addresses what is material from the perspective of the organization and of its stakeholders. This document is applicable to all organizations active in the financial sector, including, but not limited to, direct lenders and investors, asset managers and service providers. Beyond financial institutions and intermediaries, this document can be used by other parties in the financial sector such as providers or recipients of sustainable finance, governmental organizations, public and private sector institutions, business entities, industry associations, financial market regulators, and supervisory and control bodies.

This document establishes a framework and outlines a process to identify criteria for environmental impacts and performance to take into account when considering projects, assets and activities seeking finance. This document also gives guidance on assessing the risks and opportunities that can arise in applying environmental criteria to projects, assets and activities. It is applicable to parties seeking finance, providing finance or other interested parties.

This document provides a non-exhaustive list of relevant basic concepts, key initiatives and terms that are in common use in the global community of sustainable finance, and have been identified by ISO/TC 322 as helpful to facilitate a greater understanding of the topics suggested by sustainable finance practitioners, including but not limited to: financial regulators, development and commercial banks, asset managers, investors, international initiatives and researchers. The terms included in this document have been selected because they are: widely accepted and used in financial markets; sourced from supranational organization(s) or initiative(s), or national regulatory authorities; NOTE With priority given to the source with the larger geographic coverage. likely to be used in documents from ISO/TC 322 and other related International Standards; of international prevalence and interest.