Climate Challenges and Financial Institutions: An Overview of the Polish Banking Sector’s Practices
Purpose: The article aims to present the key European Union activities aimed at transforming the economy and the resulting challenges for businesses, as well as examples of international initiatives to assist businesses in meeting these challenges. Design/Methodology/Approach: Unfortunately, advances in technology and the resulting growth of the global economy have had a significant and negative impact on the global environment. Increasing demand for energy produced by burning fossil fuels has led to such non-renewable raw materials becoming more and more limited and directly translated into increased emissions of greenhouse gases, including carbon dioxide. Data cited by Our World in Data [2020] shows that the global consumption of energy generated through fossil fuel combustion has increased by as much as 170% over 50 years (1969-2019) – from 50 to 136 TWh. The amount of carbon dioxide generated from fuel combustion and cement manufacturing has increased by 165% over the same period – from nearly 14 billion to 36 billion tonnes annually. The main part of the article is a review of the market practices of Polish financial institutions and their methods of responding to these challenges in the first quarter of 2021. Findings: The Task Force for Climate Disclosure recommendations emphasize that disclosures should be prepared according to the seven principles for effective disclosure, which outline the minimum disclosure standard, Relevance, Specificity and completeness, Clarity and balance, Comparability between reporting periods, Comparability with disclosures of other entities, Reliability, objectivity, verifiability, Cyclicality. Practical Implications: Economic development has made it possible to improve the quality of life for people in many parts of the world. This was – and still is – thanks to constant technical progress, which began in earnest with the English Industrial Revolution, but only gained full momentum in the 20th century. Originality/Value: The study is a detailed presentation of procedures, directives and decisions related to climate challenges in the Polish banking sector.