Climate change should be placed “front and centre” of the Bank of England’s mandate so that the central bank can boost green investment, according to a new report that has won broad backing from the chair of the UK’s climate watchdog. Mark Carney, the BoE’s governor, has repeatedly warned of the physical damage climate change could wreak on the economy and the risks to financial stability that might result from a sudden revaluation of carbon-intensive assets. The central bank has been reviewing UK insurers and banks’ exposure to climate-related risks and supports efforts to develop international standards for voluntary disclosure. But a report from the campaign group Positive Money, published on Tuesday, argues that this concern for fin ancial stability will look “incoherent” unless the BoE does more to boost investment in the transition to a low-carbon economy. The report urged the government to rewrite the mandate of the Monetary Policy Committee to include green objectives explicitly and called on the BoE to look at ways to build climate-related risks into its macroeconomic models.
FT 15th May 2018 read more »