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Bank of England Governor Mark Carney is pushing the financial industry and central banks to do more on climate change, warning they can't ignore the risks.
In an article written with Bank of France Governor Francois Villeroy de Galhau, Carney said the “enormous human and financial costs of climate change are having a devastating effect on our collective wellbeing.” The piece was published as environmental protests in London entered a third day, blocking roads and disrupting travel across the capital.
John McDonnell, Treasury spokesman for the U.K.'s opposition Labour party, tweeted that the article was a “breakthrough moment,” and that he would “consult on changing the Bank of England's mandate to reflect the climate change emergency.” The party has previously talked about expanding the BOE's remit to include a target for house-price inflation and productivity.
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Carney and Villeroy are due to speak in Paris on the topic of climate change later Wednesday. In a Guardian newspaper article, co-authored with Frank Elderson, chair of the Network for Greening the Financial System, the policy makers said targets set in the Paris Agreement, and efforts by governments to limit the global rise in temperatures, will require a “massive reallocation of capital.”
“If some companies and industries fail to adjust to this new world, they will fail to exist,” they wrote.
That network of central banks and supervisors was set up to work on climate-related financial risks and will publish its first major report on Wednesday.
“The prime responsibility for climate policy will continue to sit with governments,” Carney and Villeroy said. “And the private sector will determine the success of the adjustment. But as financial policy makers and prudential supervisors, we cannot ignore the obvious risks before our eyes.”
To contact the reporters on this story: David Goodman in London at dgoodman28@bloomberg.net;Fergal O'Brien in Zurich at fobrien@bloomberg.net
To contact the editors responsible for this story: Craig Stirling at cstirling1@bloomberg.net, Lucy Meakin
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