Bank Watchdogs Advance Climate Work, What Trump's Tax Bill Means for Resilience, 'Earth Intelligence' Startup, and More

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Bank Regulatory Panel Defies US Pressure, But Climate Risk Rules Still Fall Short

Global banking regulators said they would prioritize analysis of extreme weather impacts on financial risks and press ahead with a voluntary climate risk disclosure framework for lenders, defying efforts by US watchdogs to derail these efforts.

At a meeting last Monday (May 12), officials overseeing the Basel Committee on Banking Supervision (BCBS) said it would publish guidelines on reporting climate-related financial risks for national authorities to consider. A survey by the Financial Stability Board found that as of last year, watchdogs in 21 jurisdictions had made progress on setting requirements, guidance, or expectations for climate-related disclosures.

Although the Basel Committee has no ability to enforce its recommendations, it is recognized as the global standard-setter on banking rules and has shaped the vast majority of post-2008 regulations worldwide. The Committee has representatives from 28 jurisdictions, and many — including the European Union, UK, and Hong Kong — embed Basel rules in their own local requirements.

The Committee’s decision to endorse further climate work came despite efforts by US regulators to sideline such initiatives. Officials from the Federal Reserve, New York Fed, Office of Comptroller of the Currency, and the Federal Deposit Insurance Corporation attempted to weaken the BCBS climate task force by turning it into a lower profile working group, the FT reported.

While this gambit seems to have failed, environmental groups say the Basel Committee has still watered down its climate ambitions. The Sierra Club blasted the standard-setter for making the disclosure framework voluntary rather than mandatory, which it says could lead to gaps in the supervision of climate-related financial risks. 

“Climate change is a systemic financial risk, and regulators turning a blind eye won’t make those risks disappear,” said Ben Cushing, Sustainable Finance Campaign Director at the Sierra Club.

In Brief

Insured losses from natural catastrophes hit US$137bn in 2024 and are expected to top US$145bn in 2025 if current trends persist, according to Swiss Re. Secondary perils like severe convective storms drove much of the damage in 2024. While there is a 1-in-10 chance of losses reaching US$300bn this year, reinsurance and alternative capital capacity is estimated to be sufficient to absorb such a shock. (Swiss Re Institute)

The UK has launched the Emerging Markets and Developing Economies (EMDE) Investor Taskforce, a public-private initiative that aims to unlock private capital for climate and sustainable development investments in poor countries. In particular, the Taskforce plans to scale capital flows to Africa, Asia, Latin America, and other regions where climate finance needs are high but private capital investment remain low. The Taskforce is backed by UK government agencies and major financial institutions including Aviva Investors, British International Investment, the Church of England Pensions Board, HSBC, Legal & General, Lloyds, and Ninety One. (Institutional Investors Group on Climate Change)

Research by residential real estate tech company Zillow indicates that Black, Hispanic, and Asian American homeowners face disproportionately high exposure to climate risks like extreme heat, wind, and wildfire. These risks are increasing their insurance costs and eroding the value of their properties, compounding longstanding racial wealth gaps. Without targeted adaptation policies and equitable access to resilience funding, climate risk threatens to further entrench housing and financial inequality. (Zillow)

The Electric Power Research Institute (EPRI) has released the Climate REsilience and ADaptation Initiative (Climate READi) — a publicly available, science-based toolkit designed to help the power sector assess and respond to growing physical climate risks. The framework advises utilities on building resilience through localized hazard assessments and system-wide resilience planning. It also provides guidance on conducting asset-level vulnerability analyses. (Electric Power Research Institute)

Sri Lanka’s central bank has launched an updated five-year sustainability roadmap aimed at scaling up green finance for climate mitigation, adaptation, natural assets, and social inclusion. New measures include enhancing green finance instruments, expanding the green taxonomy, and introducing climate insurance reforms. Central bank governor Nandalal Weerasinghe said Sri Lanka needs US$10.85bn by 2030 to meet its nationally determined contributions (NDCs) under the Paris Agreement. (Central Bank of Sri Lanka)

Trump Tax Bill Advances, with US$9.6bn of Climate Programs Threatened

Republican lawmakers advanced President Trump’s massive tax and spending bill out of a pivotal committee last night (May 18), setting the stage for a full vote of the whole chamber later this week. The legislation would undercut a raft of Biden-era measures that support US climate resilience and clawback previously awarded funds for state and community programs that fight pollution and support air and water quality.

Members of the powerful Budget Committee voted 17-16 to move the president’s fiscal package to the floor of the House of Representatives, with four conservative lawmakers abandoning earlier efforts to block its progress following talks with Speaker Mike Johnson. However, negotiations between squabbling factions within the Republican caucus are ongoing, and it remains unclear whether the legislation will pass. 

Among the many changes to climate policy proposed in the 1,100 page bill is a repeal of an estimated US$9.65bn of funds authorized under President Biden’s Inflation Reduction Act that have not yet been allocated. Many of the projects these funds would support are for state-level environmental works and programs focused on community-based resilience. 

Other measures would fast-track the break up of public lands and facilitate their sale to corporations. Thousands of acres of public land provide key ecosystem services, including flood risk mitigation and soil protection, which would be lost if they were handed over to oil, gas, and mining interests. In addition, the bill would pull US$267mn of funds from the National Park Service, endangering adaptation efforts across these tourist hotspots.  The left-leaning Center for American Progress think tank says that if passed, the bill would be “the largest successful attack by Congress on US lands and waters in modern American history.”

Among other anti-climate resilience provisions, the bill would rescind coastal restoration funds that aim to protect communities from sea-level rise risks, erosion, and worsening storms. Programs designed to improve indoor and outdoor air quality are in the bill’s crosshairs, too.

In Brief

Staffing cuts at the National Oceanic and Atmospheric Administration (NOAA) have left the National Weather Service scrambling to fill 76 meteorologist positions and a total of 155 staffer roles, including in disaster-prone areas like Houston and Miami. An internal memo shows the agency is now reassigning employees from other NOAA offices. Democrats warn this “cannibalization” will weaken the agency’s overall disaster response capacity. Meanwhile, at least eight of the country’s 122 weather forecasting offices are no longer able to operate overnight or plan to cut overnight operations within the next month and a half. (NBC News)

The US Department of Agriculture is restoring climate risk information that had been scrubbed from its websites by the Trump administration following a lawsuit by farmers and environmental groups. Plaintiffs argued that the removed data was essential for decision-making in the event of floods, heatwaves, and other extreme weather challenges. Restoration of all the information is expected within two weeks. (Environmental Working Group)

The Federal Emergency Management Agency (FEMA) is ending its practice of door-to-door disaster survivor outreach, a shift that could leave elderly, disabled, and other vulnerable populations without critical access to aid in the wake of climate disasters. The policy change was revealed in an internal memo and is part of broader reforms under the Trump administration to place more responsibility on state and local responders, many of whom may lack the resources to fill the gap. (Wired)

Republican and Democratic senators criticized Environmental Protection Agency (EPA) chief Lee Zeldin for freezing billions in congressionally mandated climate and environmental justice funding, which includes earmarks for climate resilience projects. At an appropriations hearing last Wednesday, lawmakers claimed Zeldin unlawfully impounded funds authorized under President Biden’s 2022 Inflation Reduction Act, causing initiatives to be shuttered that were protecting the lives and livelihoods of millions of Americans. (Senate Committee on Appropriations)

A majority of American voters (55%) believe federal agencies should ramp up efforts to protect people from climate change-related health impacts. Three-quarters of voters support at least maintaining current levels of action, with broad backing across political affiliations, although support is highest among liberal Democrats and lowest among conservative Republicans. In addition, an increasing percentage of Americans believe health impacts from climate change will become more common in their community over the next 10 years. (Yale Program on Climate Change Communication)

The Colorado Supreme Court ruled that Boulder County and the City of Boulder can proceed with their climate lawsuit against oil and gas majors Exxon Mobil and Suncor. The case seeks compensation for the mounting costs of climate change, arguing that fossil fuel companies knowingly contributed to the crisis while misleading the public. The ruling affirms that Colorado law can be used to hold corporations accountable for local climate harms, setting a precedent for similar cases nationwide. (City of Boulder)

Over 70% of European cities are failing to adapt to climate change in a consistent and coherent way, according to a new study published in Nature Climate Change. Nearly half lack published adaptation plans, and among those that do, most show major gaps. For example, many lack risk assessments and clear policy goals. Challenges persist on implementing the plans, too. (Nature Climate Change)

The European Union’s Pathways2Resilience initiative opened its second call for funding on May 15, offering €21mn (US$24mn) in sub-grants to help over 100 European regions and communities boost climate resilience. The financing is intended to support regions’ adaptation planning efforts and design of investment roadmaps. The deadline for submissions is August 20. (Pathways2Resilience)

The European Central Bank (ECB) has raised concerns over proposed changes to the EU’s Corporate Sustainability Reporting Directive (CSRD) and Due Diligence Directive (CSDDD), which would drastically shrink the number of companies required to report on climate and ESG risks. While the bank supports simplification to the disclosure regimes, it warns that reducing the scope by 80% could undermine financial stability, impair climate and ESG risk assessments, and make it harder to spot systemic threats to the banking sector. It urges EU legislators to retain comprehensive reporting from significant institutions and preserve sector-specific and climate-relevant data points. (European Central Bank)

Climate-fueled disasters caused 45.8 million people to become internally displaced in 2024, more than double the annual average of the last decade, according to analysis by the Internal Displacement Monitoring Center (IDMC). The US accounted for almost one-quarter of global disaster displacements, with hurricanes Helene and Milton causing particular hardship. The IDMC says many disaster-triggered displacements were pre-emptive evacuations that saved lives in the US, the Philippines, Bangladesh and other countries. (Internal Displacement Monitoring Center)

The Law Society of England and Wales has released guidance for property law specialists on climate risk. It advises homebuyers to commission bespoke climate change surveys, citing growing risks from flooding, overheating, and water stress. It also warns solicitors could face negligence claims if they fail to flag physical and legal risks linked to climate change. (The Law Society)

‘Earth Intelligence’ Startup Xoople Exits Stealth With €115mn in Funding 

AI-powered earth observation startup Xoople has exited stealth mode with a €115mn (US$129mn) war chest to bring enterprise-grade geospatial data to clients across financial services, agriculture, engineering, and more.

The Barcelona-based company, partly financed by Spanish government-backed entities CDTI and AXIS, raised around US$18mn in its most recent equity round, according to Pitchbook. Xoople calls itself the first ‘Earth Intelligence’ company, providing data and services that allow for a comprehensive understanding of physical changes to the Earth’s surface.

Data from satellites and other sources are ingested by the company’s AI systems and transformed into information that can be searched using natural language queries and other easy-to-use mechanisms. Current partners include Microsoft, which supports Xoople customer data processing via its Azure services, and geospatial software provider Esri. The company says it plans to launch a satellite constellation in the near future to bolster its Earth data capabilities.

“In our volatile world, the ability to quickly detect and precisely understand changes on the Earth’s surface is more crucial than ever,” said Xoople CEO Fabrizio Pirondini.

Xoople joins a growing cohort of geospatial risk and intelligence companies working to bring granular data on the Earth’s surface and atmosphere to corporations and financial institutions, including UK- and US-based Sust Global and Climate Engine, which was recently acquired by US-based Earth Finance. 

In Brief

CDP, the world’s largest environmental disclosure platform, is laying off 20% of its workforce as part of a strategic restructure. The organization says it is doubling down on improved technology and work processes to handle the climate, water, and forests data it ingests from over 23,000 companies each year. Chief marketing and communications officer Shannon Joly also said CDP has to cut spending amidst rising costs.. (Trellis)

Geospatial AI startup Maya Climate is shutting down after three years in operation. Launched in 2022 and dedicated to making geospatial data more accessible for business decision-making, Berlin-based Maya developed a geospatial copilot product that served clients across six continents. In 2023, the company raised a €1.2mn (US$1.4mn) pre-seed round. Founder Til Tornieporth said the company will support existing customers through the end of 2025. (LinkedIn)

Researchers at the University of Oxford have unveiled GRIT, a comprehensive global map of rivers that could provide new insights for flood forecasting, water management, and climate adaptation. Uniquely, GRIT captures how rivers branch and bifurcate, with 67,000 splits currently mapped. (University of Oxford)

Scientists in China have unveiled LICOMK++, which claims to be the world’s most advanced ocean simulation system. It offers a 1-kilometre resolution, enabling precise modeling of ocean currents, eddies, and heat transport. The system is intended to boost climate forecasting capabilities and improve scientists’ understanding of how oceans absorb heat and carbon. (South China Morning Post)

Kansas State University’s Climate Resilient Cereals Innovation Lab has resumed operations after having its federal funding restored. The Lab aims to enhance top crops’ ability to withstand drought and disease through the use of AI-assisted modeling and drone-based phenotyping, among other tech advances. (K-State)

US-based InventWood has raised US$15mn in Series A funding to begin commercial production of SUPERWOOD — a molecularly engineered material that is stronger than steel yet retains wood’s natural aesthetic. With SUPERWOOD, the company says architects and builders have more options for producing climate-resilient buildings at scale. (InventWood)

Nigeria has released its first biofortified hybrid pearl millet varieties, which are designed to thrive in the country’s drylands in the face of worsening climate conditions. The new high-yielding, nutrition-rich crop strains were developed through a partnership led by the International Crops Research Institute for the Semi-Arid Tropics. (ICRISAT)

RESEARCH

Behavioral interventions motivate action to address climate change (PNAS)

Land subsidence risk to infrastructure in US metropolises (Nature Cities)

Risks of unavoidable impacts on forests at 1.5°C with and without overshoot (Nature Climate Change)

Hurricane Ida’s blackout-heatwave compound risk in a changing climate (Nature Communications)

Considerations for improving the relevance, use, and robustness of projections of the health risks of climate change (The Lancet Planetary Health)

State of the Climate in Africa 2024 (World Meteorological Organization)

Enhancing climate finance access for Indigenous Peoples and local communities: Insights from payments for ecosystem services (World Resources Institute)

Financing climate adaptation and nature-based infrastructure (World Bank Group)

Sovereigns on thinning ice: Debt sustainability, climate impacts and adaptation (Bruegel)

Thanks for reading!

Louie Woodall
Editor