ECB official warns climate crisis poses growing threat to ‘core financial stability’
A senior European Central Bank official has warned that the climate crisis and the degradation of nature pose a significant threat to global financial stability. The ECB is increasing its monitoring of how the collapse of ecosystem services impacts bank risk profiles.
Why it matters
This signals a shift in central banking policy to treat environmental degradation as a core economic risk rather than an external factor.
A man inspects damage to his property in an area scorched by a wildfire near Vila Vella, Spain. A man inspects damage to his property in an area scorched by a wildfire near Vila Vella, Spain. Economics ECB official warns climate crisis poses growing threat to ‘core financial stability’ Exclusive: As wildfires rage, Frank Elderson says more work needed to assess risk from collapse of ecosystem services
Prefer the Guardian on Google A senior policymaker at the European Central Bank has said the climate emergency and the breakdown of nature poses a dramatically growing risk to the global economy.
Frank Elderson, a member of the ECB’s executive board, said the eurozone lender of last resort was stepping up its monitoring of the financial risks linked to the destruction of “ecosystem services”, which are nature-related processes or assets that support human activity.
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