The Network of Central Banks and Supervisors for Greening the Financial System (NGFS) has expanded its suite of climate scenario tools with the release of its first short-term climate scenarios.
According to Ortec Finance, announced on May 7, these new models offer financial institutions fresh options for integrating climate risk analysis directly into their investment and risk management frameworks.
These short-term scenarios have been designed to simulate the near-term effects of climate-related policies and climate change itself across macroeconomic indicators, sectors, and the broader financial system. The release marks a significant step for institutional investors looking to deepen their understanding of how climate-related developments might influence financial markets over the coming years.
The scenarios provide four distinct models, freely available for use, that reflect a range of plausible climate and policy outcomes from an investor’s perspective. These models aim to help institutions assess and quantify physical risks, such as extreme weather events; transition risks, including the economic impact of rapid policy shifts; and market pricing risks linked to investor sentiment and asset repricing.
By offering a short-term lens, these new NGFS scenarios complement the organisation’s existing long-term climate models, allowing investors to construct a more complete view of potential risks. Financial institutions can also combine the new models with existing frameworks such as the 2025 Ortec Finance Climate Scenarios, enabling a more integrated approach to managing climate-related exposures in investment portfolios.
NGFS’s latest release builds on previous work, including the webinar ‘Utilizing NGFS climate scenarios for climate risk analysis’.
In an upcoming webinar session, experts will explore the new short-term scenarios in greater depth, demonstrating how these models can be applied alongside longer-term frameworks to inform strategic investment decisions in a rapidly evolving climate landscape.
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