Draft Guidelines on ESG scenario analysis

The European Banking Authority (EBA) Guidelines on ESG scenario analysis (still in draft) aim to facilitate their integration into risk management and strategic planning. These Guidelines will be generally applicable as of 11 January 2026.

Draft Guidelines on ESG scenario analysis

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Executive summary

The draft EBA Guidelines aim to provide a detailed framework for integrating ESG scenario analysis into risk management and strategic planning. These Guidelines complement the EBA Guidelines on ESG risk management and describe the essential steps for conducting scenario analysis, as well as the related development processes and their use in decision-making.

The Guidelines will apply generally from 11 January 2026 and one year later, on 11 January 2027, for small and non-complex institutions (SNCIs).

Main content

The Guidelines on ESG scenario analysis cover the following key aspects:

• Scenario- analysis, a fundamental part of the risk management and strategic process. Institutions should use scenario analysis to manage ESG risks, support strategic decisions and assess their resilience to the negative impacts of ESG factors, especially those arising from climate change.
• Steps for scenario analysis. Institutions should build climate scenarios taking into account factors such as the socio-economic context, technological developments and climate policies. They should use credible scenarios adapted to their specific characteristics and ensure consistency across different time horizons. It is also important to identify the relevant transmission channels for their climate scenario analyses, taking into account both physical and transition risks, and to translate these into traditional financial risks.
• Processes for developing scenario analyses and using them in decision making. In line with these Guidelines, Institutions should develop Climate Stress Tests (CST) and Climate Risk Assessments (CRA) to assess and ensure the resilience of their financial and business models to climate risks. To do this, they should use detailed scenario analysis and projections and continuously adapt and improve their approaches based on evolving data and expert judgment.

Download the technical note on the draft Guidelines on ESG scenario analysis.