Bank of England neglected climate and nature risk, say former senior staff

Senior Bank of England staff members who have resigned from the role of supervision of climate and nature risk alleged that the central bank neglected these issues and reduced the financial sector of the UK.

Six people who left Bo From 2021 to last year, the Financial Times told the Times that climate change was deprived under Governor Andrew Bailey. Some say he removed the focus of the organization away from the risk considered “soft” and it was hard to determine the amount.

Since taking office from Bailey Mark Carni, the climate has not been empowered to take the risk as part of the mainstream supervision, adds to the former employees, some of whom are part of their career’s progress and others were disappointed because of the BOO’s approach because they were disappointed.

“Self-sensorship and exit were a repeat pattern,” said a former employee of their experience during Bailey’s period.

Another former staff member says: “The biggest risk facing the financial system. … Climate And environmental risk. The The And I just felt that what the bank was doing to address these issues was insufficient. “

As a BOE governor between 20 and 2021, Carnie was one of the first central bankers who highlighted the challenge raised at growing temperatures towards financial stability, warning it 10 years ago. “Horizon“The NDists and the insurers were failing to pay the price.

However, the debate over how much the central banks should interfere with the financial system to reduce the climate risk have changed in recent years, especially since the change against climate action under US President Donald Trump.

Deputy Governor of Financial Stability Last month said Sara Brideen, Boii It should have “swim lane” When dealing with the financial risk of climate change.

A veteran Boer official says: “It is important not to consult a particular policy direction; we simply point to risk.”

Four critical government policies aims at climate change in the list of government policies BoAt the top of the initial goal of protecting financial stability till 2021, its financial policy committee was given the responsibility of supporting the then Chancellor Jeremy Hunt.

Inquiry About the change Bailey said by a parliamentary committee in February last year: “Here is the risk of financial stability [from climate change]The We didn’t ignore it. “But he added:” The depth and width of the work we do will be trimmed somewhat. “

BOE executives recently spoke about the relevance of climate risk analysis and management in financial policy and the elasticity of the city of London. A senior officer said that it is now “in the middle of the pack”, the European Central Bank “led” and the US Federal Reserve “behind”.

However, former employees said they feared that the power of Bowie’s technical risk modeling fell behind the private sector as a result of priority change. Impact of climate change Intense in the UK.

Several former employees said the capacity of the banks and insurers was often reduced due to the suggested improvement of the BOE supervision. “I felt very frustrated that we could not do the risk we need to review what is going on in these companies.”

A person working at climate risk for insurers said that about one -third of the employees in the region were spent between 2022 and 2024.

Four former employees also said that the risk of nature – for example from pollination collapse or extinction of species – was a special blind place.

BOE decided not to name it at a Green Finance Institute last year Paper People known about the matter said that the UK GDP hit a hit from nature -related risks that it could be higher than the global financial crisis or Covid -1.

Bo says: “The government is responsible for the climate policy, the climate risk is a part of the bank’s remote to threaten our objectives, and we work to take action accordingly.”

ECB and other central banks, including the Singaporean Currency Authority, have paid more attention to how financial institutions will deal with the economic downturn, insurance providing insurance, and the economic downturn that will deal with the economic downturn and government policies.

However, there is still controversy among the forecasts, financers and regulators about how these risks are systemic for money. “For various financial groups, this is a gravel,” Bowie’s former worker has now said that an insurance working. “Mostly [in finance] Do not give any monkeys about climate change. “

Because of this attitude, the climate and nature’s work becomes less than priority, a person familiar with the current work of the Bowe says. They also added, “There are many things that are disastrous for humanity rather than disastrous for money.”

However, a veteran Boy official said that the need for additional supervision on climate risk was less because banks have already taken seriousness under the watch.

The only climate stress test in 2021-22 is expected to “draw” an average of 10 percent to 15 percent annual “profit” from climate change for banks and insurers.

However, situations that include the Climb Climate Risk Analysis of Central Banks have always been “most likely or” to identify The most deadly Possible results ”,” BOE staff said last year.

The central bank exam was intended to be held every two years but not yet repeated. “They need to invest in the right skills,” said Agarwal, head of sustainable finance, in the UK branch of the WFF.

Bowe’s Prudential Regulation Authority and the Financial Conduct Authority have set up a Climate Financial Risk Forum for industrial and regulators, which has revealed a Guide Last October at nature-related risk.

The Central Bank is evaluating with the purpose of financial risk related to nature with the purpose of its financial stability and is also consulting Supervisory expectations have been updated For climate -related banks and insurers, which will ask to fix the “gap” about how their climate change is resolved.

Banak de France prior to France, Morgan Despress said it could indicate new enthusiasm for climate work. But he added that BOE in recent years “a feeling of warning, prudence, you named it. The climate was no more important.”