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Climate Change and Principle-based Taxonomy

Issued on: 30 April 2021 Climate Change and Principle-based Taxonomy Applicable to: 1. Licensed banks 2. Licensed investment banks 3. Licensed international Islamic banks 4. Licensed Islamic banks 5. Licensed insurers 6. Licensed reinsurers 7. Licensed takaful operators 8. Licensed retakaful operators 9. Prescribed development financial institutions Climate Change and Principle-based Taxonomy 1 of 47 Issued on: 30 April 2021 TABLE OF CONTENTS Preface & Acknowledgement 2 Abbreviations 3 Part A: Overview Introduction 4 5 Applicability 6 Effective date 6 Related documents 6 Part B: Climate Change impact and opportunities Dimensions and transmission channels of Climate -related risks 7 9 Advancing Climate ambitions and opportunities 9 11 Part C: Assessment of Economic Activities Guiding principles for the assessment of economic activities 12 Guiding Principle 1: Climate Change mitigation 12 14 Guiding Principle 2: Climate Change adaptation 14 16 Guiding Principle 3: No significant harm to the environment 16 17 Guiding Principle 4: Remedial measures to transition 18 20 Guiding Principle 5: Prohibited activities 20 21 External certification and verification 21 22 Part D: Classification of Economic Activities C

Climate Change and Principle-based Taxonomy 2 of 47 Issued on: 30 April 2021 PREFACE & ACKNOWLEDGEMENT The Climate Change and Principle-based Taxonomy (CCPT) is prepared by Bank Negara Malaysia in collaboration with the Risk Management sub-committee of the Joint Committee on Climate Change (JC3). The World Wide Fund for Nature (Malaysia

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