The International Organisation for Standardisation (ISO) has introduced the world’s first international standard dedicated to climate transition plans aimed at investors.
The new standard, ISO 32212, was published on June 2, 2026. It outlines how financial institutions should identify and assess climate-related risks, opportunities, and exposures. Additionally, it provides guidance on setting climate targets and tracking progress over time.
The standard includes requirements and recommendations for incorporating climate transition plans into financing decisions and engagement strategies. It also explains how organisations should communicate their transition plans both within the organization and to external stakeholders.
British Standards Organisation stated, “It provides practical guidance for banks, insurers, asset managers, asset owners and other financial institutions on how to establish robust governance, policies, systems and controls for effective transition planning to drive their financing decisions – that is, their loan books, investment portfolios, or underwriting activities.”
“It is intended to strengthen trust, consistency and accountability across the global financial system.” ISO 32212 is based on guidance developed by the Transition Plan Taskforce, the Glasgow Financial Alliance for Net Zero, the OECD, and the Institutional Investor Group on Climate Change.
The standard consolidates best practices identified by these organizations and transforms them into a formal international standard. It has been approved by most of ISO’s 170 national standards bodies. Organizations can also use it as a foundation for independent third-party verification.
The Principles for Responsible Investment, the International Monetary Fund, and the Network for Greening the Financial System also contributed to the development of the standard.
Last week, Colin Tissen, Sustainability Lead Mandate Manager at PGGM Investments, said that financial institutions should include policy advocacy and impact investments in their transition plans.
He wrote on LinkedIn, “If we want to reduce systemic climate risk, we need to move beyond a sole focus on financed emissions and portfolio alignment.”
“Asset owners and their managers should put more resources into policy advocacy and impact investing.”
He further added that Investors, “need more understanding, not more frameworks.” He suggested that this was especially true when looking at the climate plans of companies held in investment portfolios.
Tissen wrote, “Portfolio managers ultimately use transition plans to make decisions.”
“But to do that well, they need to understand four things: Climate and nature risks; How these risks translate into economic impacts; How those impacts affect portfolios; How to act on this in practice.”
Tissen observed that many investors currently rely on simple checklists when reviewing corporate transition plans. However, this often means they do not spend enough time analysing the wider risks and economic implications for their own holdings and the broader economy.
He concluded that for transition plans to genuinely support decision-making, the industry must prioritise education and build deeper expertise in this area.
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