How to Explain CCPT to a Relationship Manager/Credit Officers: A Practical Banker’s Guide.
“What’s CCPT and why does it matter to me?”
That’s the question I often hear from Relationship Managers (RMs) across business units. And it’s a fair one.
As frontliners, RMs are expected to meet business targets, build strong client relationships, and now — understand climate-related risks too. But Bank Negara Malaysia’s Climate Change and Principle-based Taxonomy (CCPT) doesn’t have to be overwhelming. Think of it as a practical lens to assess future creditworthiness.
- What is CCPT in Simple Terms?
CCPT is a classification tool introduced by BNM to help financial institutions understand whether an activity is:
a. Supporting the climate transition (Green), or b. Trying to get there (Amber), OR c. Contributing to environmental harm (Red).
It looks at two things: 1. The economic activity of the borrower, and 2. Whether that activity has a credible transition plan.
I have shared below a practical approach recommended for Relationship Manager/Credit Officers and hope it helps.
Not stopping there; do also look out for my next sharing - How CCPT Influences Lending, Pricing, and Risk Decisions
