"FSA Analytical Notes (2025.7)" published by the Financial Services Agency on July 4, 2025, is a report that comprehensively analyzes banks' approaches to climate-related risks by combining quantitative analysis methods and text data analysis methods.
Key Points
Quantitative Analysis of Greenhouse Gas (GHG) Emissions
- Conducted quantitative analysis focusing on banks' greenhouse gas emissions
- Confirmed that overall bank GHG emissions are on a declining trend, although there are differences by business type and individual factors
- Analyzed emission data for each financial institution in detail to understand overall trends
- Conducted analysis considering characteristics by business type regarding factors behind the declining trend
Analysis of Disclosure Documents Using Text Data Analysis
- Utilized advanced text data analysis methods including Large Language Models (LLM)
- Systematically analyzed climate change-related content in each bank's disclosure documents
- Confirmed that climate change-related disclosures are increasing, consistent with the declining trend in GHG emissions confirmed through quantitative analysis
- Understood qualitative and quantitative changes in information disclosure regarding banks' climate change initiatives
Trial of Comprehensive Analysis Approach
- Established a comprehensive analysis framework combining quantitative methods and text analysis methods
- Evaluated banks' climate change responses from both numerical data and qualitative information perspectives
- Demonstrated that integrating multiple analysis methods enables more multifaceted understanding of the actual situation
- Can be utilized as a new methodology for future climate-related risk analysis
Promotion of Advanced Data Utilization
- Positioned enhancing data utilization in financial administration as an important medium- to long-term issue
- Continuously promoting efforts to improve organizational data analysis capabilities and data infrastructure
- Aiming for continuous improvement in financial administration by combining granular data and advanced analysis methods
- Policy to continuously publish analysis cases through the FSA Analytical Notes series
The article shows that the FSA is adopting an advanced approach that integrates quantitative and qualitative methods in climate-related risk analysis to more accurately understand the actual state of the banking sector's climate change response.