News 03/12/25

First steps in the right direction towards transparent reporting on climate transition plans and financed emissions

Large financial institutions are reporting on their climate transition plans and their financed emissions. They are doing this for the first time in line with new sustainability reporting rules, where the information must be relevant, reliable, understandable, and comparable. The AFM conducted an exploratory review among several major Dutch banks and insurers. In the report ‘Towards transparent reporting on climate transition plans and financed emissions’, we present a market overview and provide key considerations for a more standardised approach to transition plans in sustainability reports.

In short

• Transition plans in sustainability reports provide insight into strategic choices for climate transition
• Sustainability reporting is a learning process
• Market overview: banks
• Market overview: insurers
• Data quality in the value chain remains challenge

Transition plans in sustainability reports provide insight into strategic choices for climate transition

In 2024, the institutions under review published a sustainability report for the first time in line with the Corporate Sustainability Reporting Directive (CSRD). They did so voluntarily, as this directive has not yet been implemented in Dutch law. A key component of sustainability reporting is the transition plan, which all eight institutions included in their reports.

Sustainability reporting is a learning process

Reporting under the CSRD is a learning process—for the institutions themselves, but also for other stakeholders, including the AFM. We therefore encourage the sector to continue working towards a more standardised approach and in our report provide key considerations going forward for the entire sector. This will enable users of the reports to assess and compare the impact, risks, and opportunities of institutions regarding climate and transition plans. The sector is already involved in several (national and international) initiatives and collaborations aimed at improving and developing sustainability reporting and transition plans. The AFM encourages the sector to continue these industry initiatives for further standardisation.

Market overview: banks

Our review shows that the banks reviewed provide detailed and extensive reporting on their emissions and plans. All four banks report on their transition plan and interim targets. However, the scope and depth still vary significantly. For banks, financed emissions from corporate loans are particularly relevant, as these represent by far the largest source of emissions. Banks provide insight into the sectors they finance and the targets and plans per sector. Consistency in definitions, measurement methods, and metrics within and across annual reports, could be improved to further clarify the scope of the plans and enhance comparability.

Market overview: insurers

The four insurers reviewed report on their emissions data per asset class in broadly comparable ways, but the level of detail differs. Most financed emissions relate to corporate bonds and sovereign bonds. The transition plans mainly focus on financed emissions from own investments. Comparability among insurers is still limited due to differences in scope, metrics, and reporting formats. Additional information on decarbonisation is often provided outside the annual report.

Data quality in the value chain remains challenge

All institutions reviewed indicate that data quality in the value chain remains a major challenge. Uncertainties arise from limited data availability, particularly further down the value chain. Obtaining reliable and up-to-date data from parties deeper in the value chain is more complex than from direct counterparties. As a result, institutions rely heavily on estimates, models, and external data providers.