Central banking and financial supervision in the biosphere

Many drivers of climate change, such as land-use change and deforestation, contribute to the degradation of the natural environment. A growing number of central banks and financial supervisors have recognised the need to extend their focus from climate change to the broader challenges posed by environment-related risks. Building greater understanding of the impacts and dependencies of the financial system on biodiversity and ecosystem services is an emerging priority we are working to address.

To tackle these challenges and propose recommendations for action and further inquiry, INSPIRE and the NGFS joined forces in April 2021 to launch the Joint Study Group on Biodiversity and Financial Stability.

The Study Group grew to include 25 NGFS members (central banks and supervisors) and observers, as well as 28 academic and professional institutions . In all, it has involved over 100 participants who have shared their expertise, produced input papers, and reviewed and shaped the three reports that we have produced.

Find these input papers and the list of Study Group members below.

In March 2022, we published the Study Group’s final report ‘Central banking and supervision in the Biosphere: An agenda for action on biodiversity loss, financial risk and system stability‘.

This report outlines the current understanding of financial system exposures to biodiversity-related risks and explores the critical challenges the financial system faces in responding to biodiversity loss. We find options are available for central banks and financial supervisors to address biodiversity loss and provide 5 recommendations, setting a global baseline for why and how financial authorities should act on addressing nature-related financial risks.

Ravi Menon, Managing Director of the Monetary Authority of Singapore and Chair of the NGFS - March 2022
“Biodiversity loss could have significant macroeconomic implications. Failure to account for, mitigate, and adapt to these implications is a source of risks relevant for financial stability.”

Report Launch: Central Banking and Supervision in the Biosphere



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Study Group Members

Co-led by Dr Ma Jun (NGFS Workstream on Research and the People’s Bank of China) and Professor Nick Robins (INSPIRE and the LSE), the Study Group draws upon the expertise of NGFS members and observers, academics and professional institutions from across the globe:

Asian Development Bank Banco Central de Chile Banco Central do Brasil Banco de España Banco de México Bank Al-Maghrib Bank Negara Malaysia Bank of England Suomen Pankki Bank of Greece Banque de France Banco Central de Costa Rica De Nederlandsche Bank European Central Bank Financial Regulatory Authority of Egypt Hong Kong Monetary Authority International Monetary Fund Japan Financial Services Agency Monetary Authority of Singapore OECD People’s Bank of China United Nations Development Program Sustainable Insurance Forum World Bank Agence Française de Développement AgroParisTech - Centre de Montpellier Boston University - Global Development Policy Center University of Cambridge - Cambridge Institute for Sustainability Leadership Council on Economic Policies Centre de Coopération Internationale en Recherche Agronomique pour le Développement Cornell University - Charles H. Dyson School of Applied Economics and Management École National de la Statistique et de L’Administration Économique - Centre for Research in Economics and Statistics Erasmus University Rotterdam - Department of Finance Finance for Biodiversity Greeninnovation hub Institute of Finance and Sustainability London School of Economics and Political Science - Grantham Research Institute on Climate Change and the Environment Peking University - School of Economics ShareAction SITAWI Finanças do Bem SOAS, University of London - Centre for Sustainable Finance Sustainix Tsinghua University - People’ Bank of China School of Finance UN Environment Programme World Conservation Monitoring Centre University College London (UCL) Institute for Sustainable Resources University College London (UCL) Institute for Innovation and Public Purpose (IIPP) University of Brasília - Department of Ecology University of British Columbia - Department of Geography Wageningen University - Department of Animal Studies World Economic Forum Beijing WWF Greening Financial Regulation Initiative WWF Global Forests Practice 2 Degrees Investing Initiative