division_name: Financial Services Bill - <i>Report (1st Day)</i> &#8212; Amendment 3
motion: <p class="italic" pid="a886.2/1" pwmotiontext="unrecognized">Moved by Lord Oates</p>
  
  <p class="italic" pid="a886.2/2" pwmotiontext="unrecognized">3: After Clause 5, insert the following new Clause&#8212;&#8220;Review of capital adequacy requirements risk weights(1) Within six months of the day on which this Act is passed the Prudential Regulation Authority must complete a review of the risk weighting applied to investments in&#8212;(a) existing fossil fuel exploitation and production, and(b) new fossil fuel exploration, exploitation and production.(2) In conducting this review, the Prudential Regulation Authority must have regard to&#8212;(a) the need to prevent the misallocation of investment to global warming accelerating activities as a result of artificially low risk weights;  (b) the full implications of climate change for the risk of investments including physical climate risks, transitional climate risks and climate liability risks;(c) the likelihood of assets becoming wholly or partially stranded before the end of their normal exploitation cycle;(d) the impact of global warming accelerating activities on financial stability, in particular as a result of climate change related disruption of the economy; and(e) the advice of the Climate Change Committee.(3) The Treasury must lay before Parliament the outcome of this review within one month of the completion of the review.&#8221;Member&#8217;s explanatory statementThe purpose of this amendment is to place a requirement on the PRA to review the adequacy of risk weights applied to fossil fuel exposures in capital requirements having regard to the implications of climate change.</p>
  
  <p pid="a912.0/6" pwmotiontext="yes">Ayes 276, Noes 276.</p>