Climate change and biodiversity loss: new territories for financial authorities

Abstract

Climate change became a central issue in 1988 with the creation of the Intergovernmental Panel on Climate Change. Financial authorities only started to take up the subject in 2015. Since then, they have continuously accelerated their endeavour in this regard and have quickly added biodiversity loss to the environmental issues to deal with. Unfortunately, despite the very fast learning curve they follow, financial authorities have taken a path that may not succeed. But moving beyond approaches solely based on a financial risk paradigm and fostering transdisciplinary research to address broad systemic questions at the interface of the natural and socioeconomic worlds, central banks and supervisory authorities could enter a new era, where the impact of their decisions would contribute materially to solve the challenges of our time.