On 13 February 2025, the European Central Bank (ECB) published a speech: From concept to delivery: accounting for climate and nature in maintaining price stability and keeping banks safe and sound, which was delivered by Frank Elderson, a member of the ECB’s Executive Board and vice-chair of its Supervisory Board, at the MNI Webcast on Climate Change.

In the speech, Mr Elderson discusses what the ECB is doing to account for climate and nature in its monetary policy and in banking supervision. Points covered in the speech include:

• The fundamental principle – that climate and nature are relevant for both monetary policy and banking supervision and, therefore, must be taken into account in the exercise of the ECB’s tasks – is independent of the actions of climate and nature policymakers. However, the intensity and configuration of the risks that will ultimately materialise is not. 

• The physical risks of climate and nature hazards are currently materialising at an ever-increasing scale and frequency and will continue to do so, which will cause an increase in transition risks.

• Reporting requirements in the EU’s sustainable finance framework will improve the availability of reliable and comparable data that are needed to identify and manage financial risks, and this is essential to ensure that the broader sustainable finance framework can serve its purpose of unlocking finance for the green transition and thereby contributing to Europe’s competitiveness agenda.