{"id":657732,"date":"2026-06-25T15:48:09","date_gmt":"2026-06-25T15:48:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/657732\/"},"modified":"2026-06-25T15:48:09","modified_gmt":"2026-06-25T15:48:09","slug":"uk-regulator-to-launch-testing-scheme-for-new-climate-scenario-tools-news","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/657732\/","title":{"rendered":"UK regulator to launch testing scheme for new climate scenario tools | News"},"content":{"rendered":"<p>The UK\u2019s financial markets supervisor will this autumn launch a testing scheme for innovative climate scenario tools, as pension fund trustees have separately been urged to strengthen how they use scenario analysis.<\/p>\n<p>The first providers have already been welcomed into the Financial Conduct Authority\u2019s (FCA) new regulatory sandbox on climate scenarios, which aims to bring together industry representatives with a view to improving how climate risks are assessed and applied in practice by market participants.<\/p>\n<p>TREX, a University of Exeter spin-out that recently <a href=\"https:\/\/www.ipe.com\/uss-and-academics-develop-new-approach-to-climate-scenarios\/10068709.article\" target=\"_blank\" rel=\"nofollow noopener\">partnered with the Universities Superannuation Scheme on new narrative climate scenarios<\/a> for \u201cenhanced investment resilience\u201d, is already on board the FCA\u2019s new initiative, according to an update this week from Alicia Kedzierski, the watchdog\u2019s head of sustainable finance department.<\/p>\n<p>The FCA\u2019s initiative is part of <a href=\"https:\/\/www.ipe.com\/analysis\/how-useful-is-climate-scenario-analysis\/10135861.article\" target=\"_blank\" rel=\"nofollow noopener\">broader efforts to restore the credibility of mainstream climate scenario analysis<\/a>, which has been criticised for reasons including unrealistic pathways and <a href=\"https:\/\/www.ipe.com\/comment\/viewpoint-investor-climate-scenarios-need-to-be-probability-aware\/10071504.article\" target=\"_blank\" rel=\"nofollow noopener\">failing to offer probabilities<\/a>.<\/p>\n<p>According to Accounting for Sustainability, a non-profit organisation, there is also room for improvement in how pension fund chairs and trustees use scenario analysis at board level.<\/p>\n<p>In a <a href=\"https:\/\/www.accountingforsustainability.org\/en\/knowledge-hub\/guides\/scenario-analysis-pension-chairs-trustees-top-tips.html\" target=\"_blank\" rel=\"nofollow noopener\">guide<\/a> published today, A4S set out ways in which boards could take greater ownership of scenario analysis, \u201cmoving it from a primarily analytical exercise to a practical input into strategic decision-making\u201d.<\/p>\n<p>It suggested this could be done by being clearer about climate scenario analysis\u2019s purpose, challenging underlying assumptions, and combining quantitative outputs with narrative-led approaches that explicitly explore uncertainty, non-linear change and hard-to-model risks.<\/p>\n<p>The guide was developed by A4S alongside its Asset Owners Network, an invitation-only forum for pension fund chairs to share practical approaches to integrating sustainability into long-term strategic and investment decision-making.<\/p>\n<p>The FCA\u2019s climate scenario testing scheme is aimed at climate scenario firms or specialists working on approaches including plausible low-probability, high-impact risks; tipping points, second-order and compounding effects, or subnational and sector-specific impacts, reverse stress testing.<\/p>\n","protected":false},"excerpt":{"rendered":"The UK\u2019s financial markets supervisor will this autumn launch a testing scheme for innovative climate scenario tools, as&hellip;\n","protected":false},"author":2,"featured_media":657733,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[59,57,58,50,56,54,55],"class_list":["post-657732","post","type-post","status-publish","format-standard","has-post-thumbnail","category-united-kingdom","tag-gb","tag-great-britain","tag-greatbritain","tag-news","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/657732","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=657732"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/657732\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/657733"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=657732"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=657732"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=657732"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}