H.R. 2923: To nullify certain interagency guidance related to climate-related financial risk management for large financial institutions.

This bill, identified as H.R. 2923, aims to nullify specific guidance related to financial risk management associated with climate change for large financial institutions. The key provisions of this legislation include:

1. Nullification of Interagency Guidance

The bill effectively nullifies the final interagency guidance that was issued by three federal financial agencies: the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, and the Federal Deposit Insurance Corporation. This guidance, titled Principles for Climate-Related Financial Risk Management for Large Financial Institutions, was published on October 24, 2023.

By nullifying this guidance, the bill prohibits these agencies from enforcing the recommendations put forth that focus on how large financial institutions should manage risks associated with climate change. Furthermore, these agencies would be barred from issuing any similar guidance in the future.

2. Implications for Large Financial Institutions

As financial institutions are significant players in the economy, the nullification of such guidance could influence their strategies and operations regarding climate-related risks. This includes how they assess, manage, and disclose these risks in their financial practices.

3. Legislative Process

The bill was introduced in the U.S. House of Representatives on April 17, 2025, by Mr. Balderson and co-sponsored by Mr. Pfluger. After its introduction, it was referred to the Committee on Financial Services for review.

4. Context of the Guidance

The original guidance aimed to help large financial institutions prepare for and mitigate risks related to climate change, which can have substantial financial implications through various channels such as physical risks (natural disasters), transition risks (policy changes), and reputational risks.

5. Overall Impact

The passing of this bill would mean that large financial institutions may not be held to any formal expectations regarding climate risk management as outlined in the nullified guidance. This could lead to less structured approaches to integrating climate-related factors into their risk management frameworks.

Relevant Companies

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