In news from the EU financial sector, the European Central Bank (ECB) announced the completion of its 2024-2025 climate and nature plan. The two-year plan saw the ECB improve its policies related to climate stress testing, supervisory risk management, and management of nature-related risks. The ECB is the EU’s primary authority for managing monetary policy and keeping the euro stable, so its approach to climate and nature has significant implications for the EU financial sector as a whole. A press release from the ECB discusses the ECB’s next steps on climate and nature:
“The economic and financial consequences of climate change and nature degradation continue to grow. The ECB therefore remains firmly committed to embedding climate and nature into its work, ensuring resilience to rising physical risks and transition challenges.”
The ECB goes on to say that it will focus its efforts on three priority areas. These include the transition to a green economy, coping with the growing physical impacts of climate change, and assessing the impact of nature-related risks and ecosystem degradation. Attention is starting to move from climate-related disclosures to broader nature-related disclosures. Between this announcement from the ECB and the ISSB’s developing nature standards, a trend is beginning to emerge. 2026 could be the year that nature-related risks take the mainstage.
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