Climate change and financial stability

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In the context of its annual cycle of conferences on financial systems, AFD organizes a webinar on the implications on financial stability from climate change and how this affects the work of central banks and supervisory authorities.

It is now widely recognized that climate change induces a variety of economic and financial risks. In January 2020, Banque de France and the Bank for International Settlements published a book entitled The green swan , the title referring to unexpected and rare events where traditional approaches to risk management are largely irrelevant to assess future climate-related risks, hence increasing the likelihood of systemic financial crisis.

The webinar will:

• explore the challenges posed by climate risk on financial stability and supervision,
• share concrete examples of policies and initiatives put in place by central banks and supervisors both in developed countries and emerging market economies, and
• expand on how the international community – including donors – can contribute to advance the global response to address the challenges that climate change poses on financial stability management.

The webinar takes place a week after the Finance in Common summit organized by AFD, which ended with a declaration made by 450 public development banks who committed to foster the redirection of financial flows in support of low-carbon and climate-resilient sustainable development.