Fitch Ratings, a leading provider of credit ratings, invites feedback from market participants on its Discussion Paper covering Climate Vulnerability in Corporate Ratings. The paper lays out a proposal to support consistency and transparency in the way Fitch Ratings identifies and addresses potentially credit-relevant climate risks in its credit rating process.

Fitch’s Climate Vulnerability Scores (denominated Climate.VS) for non-financial corporates (at the sector level and at the individual entity level) capture Fitch’s view of the exposure of their credit profile to a rapid low-carbon transition between 2025 and 2050. During year 2022, Fitch released 13 sector-level Climate.VS reports covering all the major non-financial corporate sectors. The agency proposes to use its existing sector-level Climate.VS as the basis for a screening tool to identify entities potentially vulnerable to climate-related risks, and subject these entities to an additional analysis and consideration in its credit rating committees.