Europe’s central banks have agreed on common principles for responsible investment and disclosure requirements for their own-fund portfolios.
The agreement between the Eurosystem’s 19 national central banks and the European Central Bank (ECB) will “increase the awareness and understanding of climate risks while promoting climate-related disclosures,” the ECB said in announcing the move.
Own-fund portfolios held by central banks include investment portfolios and staff pension funds, but do not include assets held under monetary policy purchasing programmes. These funds must now be managed according to investment principles aligned with the recommendations of the Network for Greening the Financial System (NGFS).
Several Eurosystem central banks, including the ECB, already apply sustainable and responsible investment practices in the management of their non-monetary policy portfolios. Banque de France, the first Eurosystem central bank to make responsible investment commitments, has recently announced that it will exclude all companies with coal-related activities from 2024. In addition, both the Bank of Finland and De Nederlandsche Bank are signatories to the UN-affiliated Principles for Responsible Investment.
The agreement also aims for all Eurosystem central banks, including the ECB, to begin annual climate-related disclosures of their own-fund portfolios within the next two years, following recommendations of the Task Force on Climate-related Financial Disclosures.
This page was last updated April 23, 2021
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