The European Central Bank (ECB) wants to become greener in its monetary policy. “As part of our mandate, we are taking further concrete measures to integrate climate change into our monetary policy operations,” said ECB President Christine Lagarde on Monday in Frankfurt/Main.
Among other things, the euro central bank wants to pay more attention to climate aspects when buying corporate bonds in the future. To do this, it plans to increase the proportion of bonds in its portfolio that are issued by companies that have a better carbon footprint. The currency watchdogs want to implement this from October when reinvesting expiring company stocks.
When Lagarde took office in November 2019, the ECB pledged to play a stronger role in the fight against climate change. During the complete overhaul of its monetary policy strategy that took place last year, the ECB announced that it would take greater account of the risks arising from climate change in its monetary policy in future and play a more active role.
Climate criteria should also be given greater weight in the rules for collateral that banks provide in lending transactions with the ECB. Among other things, she wants to limit the proportion of debt instruments from companies with a high CO₂ footprint that can be provided as collateral in the future. This will probably be implemented before the end of 2024, provided the technical requirements are met, the monetary watchdogs announced.