Sylvie Goulard: Speech - Green Swan conference

Speech by Ms Sylvie Goulard, Deputy Governor of the Bank of France, at the Green Swan 2021 Global Virtual Conference, 3 June 2021.

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

Central bank speech  | 
10 June 2021

I would like to thank all the organisers of this Green Swan conference, and especially Luiz Awazu Pereira da Silva from the BIS.

Luiz has been the soul of the organising team we set up some months ago with the authors of the Green Swan - Prof Bolton, Morgan Després, Luiz Pereira da Silva, Frederic Samama, Romain Svartzman – to whom I wish to pay tribute.

As the Green Swan was published in January 2020, we were living in a pre-Covid world.

The authors warned of the severe risks associated with climate change and of "other human-caused caused environmental degradation such as the loss of biodiversity".

The title of the Green Swan is a play on the concept of Nassim (Nicholas) Taleb's – the Black Swans, i.e. events affecting the financial sector that are unexpected, of a large magnitude and can be only explained afterwards), with analogies but also differences:

  • It is quite certain that climate events will occur even if we don't know when and how; 
  • They could be even worse than the ones caused by Black Swans, because climate change and many of its impacts are largely irreversible;
  • no single agent (household, firm, financial institution, government) can hedge against these risks on her/his own. This means that managing Green Swans requires an unprecedented level of cooperation.

As the recent IEA report stresses "the global pathway to net-zero emissions (-) requires all governments to significantly strengthen and then successfully implement their energy and climate policies. Commitment made to date fall short of what is required".

Meanwhile, the world has been hit by the Covid 19 health crisis.

This is a crisis that is due to lack of prevention, unpreparedness at national levels and flaws in international cooperation.

This is a crisis that has forced governments to lock down hundreds of millions of people and has stopped or reduced economic activity.

This is a crisis with huge macroeconomic costs and which has forced governments to provide substantial fiscal support and central banks to intervene with bold monetary policies, in order to preserve favorable financing conditions.