The report, which covers the 2023 calendar year, provides insights into the bank's governance, strategy, risk management practices, and its approach to managing climate-related risks within non-monetary policy portfolios.
"The release of this second disclosures report underlines Latvijas Banka's dedication to sustainability, transparency, and sound governance," said Mārtiņš Kazāks, Governor of Latvijas Banka. "This report reflects our ongoing efforts to provide the public with a clear and comprehensive understanding of our activities."
The report reveals that Latvijas Banka has made steady progress in reducing its carbon footprint within its developed markets equity portfolio. In 2023, the carbon footprint decreased by 22% compared to 2022 data, resulting in a total reduction of 59% since the implementation of the sustainability strategy.
The report also discloses that due to a change in the benchmark index of the emerging market fixed income portfolio, the ESG score of the portfolio improved by 13%, from 46 at the end of March 2024 to 52 at the end of April 2024.
"Latvijas Banka is committed to contributing to global efforts to address challenges such as climate change, biodiversity conservation, and inequality," said Kazāks. "We recognize that by addressing climate-related and broader sustainability challenges, we can create long-term value for our society, contribute to a more sustainable future, and inspire the entire Latvian financial sector to follow suit."
Latvijas Banka's disclosures are part of an effort by all Eurosystem's central banks to publish climate-related financial disclosures on their euro-denominated non-monetary policy portfolios using a common framework that sets minimum reporting requirements.
The sustainability disclosures report is available on Latvijas Banka's website in English here.
