: the more transparent banks are about their c & e risk profiles and their concrete efforts to align their portfolios with the paris agreement, the easier it is for market participants to compare banks, reward those which are taking the necessary steps to adopt risk management practices aligned with a carbon - neutral economy, and re - evaluate those with misaligned trajectories. transparent disclosures also create a certain level of peer and stakeholder pressure, which is essential to making companies properly manage their risks. investors and asset managers are seeking to develop and market portfolios that are aligned with the sustainability objectives of their own clients. as such, they are becoming increasingly demanding about corporate c & e disclosures. banks ’ own shareholders are becoming increasingly demanding, too, especially concerning banks that have publicly committed to achieving net zero targets. in fact, failure to disclose meaningful follow - up information on their climate commitments has already led to significant litigation and given rise to heightened reputational and legal risks for some banks. recent regulatory and legislative initiatives reflect growing international awareness of the great value of transparent disclosures on c & e risks. in europe, large banks will have to disclose climate - related information under the european banking authority ’ s comprehensive implementing technical standards. they will have to already do so by early 2023, referencing data from the end of 2022. the information requested from banks includes qualitative and quantitative information on environmental, social and governance risks, as well as indicators such as alignment metrics and the green asset ratio – thus significantly raising the bar in terms of c & e risk reporting. in the same vein, sustainability reporting obligations under the european commission ’ s corporate sustainability reporting directive will shortly apply to large corporations, including banks under our direct supervision. main findings of the ecb report on banks ’ progress towards transparently disclosing their c & e risk profile the ecb is also well aware of the importance of transparent disclosures. we published our first stocktake of banks ’ c & e disclosures back in november 2020. we did so precisely to give banks the time and the incentive to improve the quality of their own disclosures in this field. back then, virtually none of the institutions in the scope of the assessment met our expectations as set out in the ecb guide on climate - related and environmental risks, which we published at the same 2 / 4 bis central bankers'speeches time. the second stocktake, published today, shows that the quality of banks ’ disclosures has improved since then

achieving the objective, particularly in areas and among populations where biases and negative perceptions may have contributed to market failures, helps people improve their financial standing, regardless of their current economic status. for nearly four decades, numerous policies and programs have been implemented with the intent of increasing economic opportunity. a variety of management and funding strategies have been implemented, ranging from federal government appropriations to debt and equity financing from private sources. despite the broad spectrum of programs, the length of time they have been in place, and the array of funding participants, empirical research quantifying their impact is rare, regardless of whether government agencies, nonprofit organizations, or private entities sponsor the programs. the lack of empirical data is particularly regrettable in the case of government - sponsored programs, because quantifying the impact of these programs is crucial to the legislative process. when a bill is proposed in congress, the nature of the problem and the factors presumed to be contributing to that problem typically are explicitly stated. and generally included is a projection of the outcomes that would indicate success. this process of problem diagnosis, program justification, and projection of results, if fully embraced, provides a framework for assessing a program's value. the program can be judged worthwhile when the data demonstrate that the benefits exceed the costs, including the opportunity costs of any investment. even with such a framework, conducting research on community development and economic empowerment programs can be challenging, in part because the effects these programs intend to achieve are often quite difficult to measure and may not become apparent for relatively long periods of time. initiatives aimed at addressing complex economic and social problems that were decades in the making most likely require many years to achieve their goals. also, virtually no specifically defined standards exist for monitoring the value of social and economic improvement programs. for community development researchers, the challenge is to develop parameters for objectively assessing the value of their programs. for example, the measures that affordable - housing organizations use could illustrate the extent to which their programs have, or have not, increased homeownership rates and property values, reduced crime, improved school performance, or spurred new private - sector investment in a disadvantaged neighborhood. research must isolate the variables that best convey the impact of a program, define the specific data that must be collected, and develop a system for maintaining and retrieving the data over time. in other words, the challenge is to quantify the marginal effect of a program. the value of such a system is clear. so too, however, is the