Sarah Breeden: Avoiding the storm - climate change and the financial system

Speech by Ms Sarah Breeden, Executive Director of International Banks Supervision of the Bank of England, at the Official Monetary & Financial Institutions Forum, London, 15 April 2019.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Central bank speech  | 
30 April 2019
by Sarah Breeden
PDF full text
(383kb)
  |  8 pages

Introduction

My message today is simple. Climate change poses significant risks to the economy and to the financial system, and while these risks may seem abstract and far away, they are in fact very real, fast approaching, and in need of action today.

In short, there are storm clouds on the horizon and the financial system needs to act now to plot a new course to safer waters. To do that we will need three things. Firstly, a destination. Secondly, an able crew. And finally, a nautical chart - or map - to get us there.

We have the destination. More than 190 countries have signed the 2015 Paris agreement and set a goal to limit average global temperature rises to well below 2 degrees above pre-industrial levels. We even have a broad course to follow - that of a smooth and orderly transition.