Climate-related financial policy index: A composite index to compare the engagement in green financial policymaking at the global level

This study presents a composite index for assessing, quantifying, and comparing international engagement based on evidence that countries have been globally committed – to varying degrees – to climate-related financial policymaking in recent decades. The proposed investigation aims to promote awareness about countries’ global engagement and identify gaps in climate-related financial policy. Using a standardised metric, researchers and policymakers can use the generated climate-related financial policy index (CRFPI) to compare international commitment to climate-related financial policymaking. Emerging economies are the most engaged in green financial policymaking, although they report the highest within-group variability, indicating no standard or general approach to “greening” the financial system. The index demonstrates a location effect, as most jurisdictions with high CRFPIs are in Asia-Pacific and North Europe. Brazil, China, France, Indonesia, and South Korea had the highest scores among G20 countries. After examining several aggregation approaches, the findings appear to be robust overall.