Mark Carney of BoE to be Financial Adviser for UN Climate Conference

Meeting the goals agreed in the Paris Agreement requires a fundamental shift in the global economy. The financial sector will play a critical role in achieving commitments to net zero. A sustainable financial system can accelerate and smooth the transition to a net zero economy by funding private sector initiatives and amplifying the effectiveness of government climate policies. Central banks can help build the foundations so that the financial sector can both manage the risks and seize the opportunities around climate change. By doing that, financial markets will amplify the effects of climate policy by pulling forward the necessary adjustments. 

Among other tasks, the Prime Minister’s Finance Adviser for COP26 will support the refinement of disclosure standards for climate-related financial risks and define pathways to mandatory reporting. He will work toward enhancing management of climate-related financial risks by defining scenarios for banks and insurers to assess the resilience of firms’ strategies to the transition to net zero and by working with the Network for Greening the Financial System (NGFS) to roll out climate stress test scenarios so that other supervisors can stress test their own jurisdictions. The Adviser is also tasked with empowering consumers with disclosures on whether their investments are consistent with the path to net zero and on working with the Task Force on Climate-related Financial Disclosures (TCFD) and the private sector to develop a reporting standard. Another responsibility will be mobilizing Innovative Finance to support the transition by developing markets, such as green and transition bonds, and by reviewing the scope for improvements in the availability of insurance against climate policy risks.

Related Links

• News Release
• Terms of Reference (PDF)

Keywords: Europe, UK, Banking, Insurance, Climate Change Risk, Mark Carney, ESG, Disclosures, Reporting, UN Climate Change Conference, BoE