The Commodity Futures Trading Commission (CFTC), the U.S. derivatives regulator, has launched a consultation into climate-related financial risk in the commodities and derivatives markets.
The agency issued a paper seeking input to inform its oversight of the derivatives markets and the underlying commodities markets to help the CFTC promote innovation, supervise derivatives transactions and avoid systemic risk.
The results of the consultation may result in the regulator issuing new rules, guidance or policy statements, or taking other sorts of regulatory action.
“The [consultation] will seek responses on questions specific to data, scenario analysis and stress testing, risk management, disclosure, product innovation, voluntary carbon markets, digital assets, greenwashing, financially vulnerable communities, and public-private partnerships and engagement, said Rostin Behnam, chairman of the CFTC, in a statement.
“My intention is to focus on ensuring that America’s farmers, ranchers, manufacturers, commercial end-users, and investors are equipped to manage their risks from increasingly severe and frequent weather events as well as the transition to a net-zero, low-carbon economy,” he said. “The [consultation] seeks to ensure that we as regulators are informed, educated and engaged.”
The consultation will be open for 60 days.