Supporting central banks and ministries of finance to green private and public finance.
About the project
In the face of accelerating environmental breakdown, financial flows must urgently realign away from ecologically damaging and towards sustainable activities. This project aims to accelerate this shift by influencing monetary and fiscal policy and financial regulation undertaken by central banks, financial supervisors, ministries of finance and other relevant policymakers. Our research has built the case for policy interventions to be taken on a precautionary basis. This is justified by both the radical uncertainty and non-linear nature of climate change and biodiversity loss, including the challenge of ecological ‘tipping points’ and the catastrophic consequences of policy inaction.
Over the course of this project, which was initiated in 2018, sustainability goals have steadily been moved up the agendas of macroeconoimc and financial policymakers, and IIPP research has had significant impact contributing to this progress. The ‘precautionary financial policy’ approach has been referenced in policy documents by the White House, the Network for Greening the Financial System (NGFS) and the Canadian Senate as well as individual central bank research. Our work on nature-related financial risks was also cited in the influential Dasgupta Review on the Economics of Biodiversity, and our researchers contributed substantially to a study group launched jointly by the NGFS and the INSPIRE research network on ‘Biodiversity and Financial Stability’.
Our staff have provided consultancy to both the NGFS and the World Bank on these agendas and we collaborate with a number of individual central banks, as well as working in close partnership with other universities, foundations, think tanks, and NGOs on this agenda.
- Academic journal papers
- Kedward, K., Zu Ermgassen, S., Ryan-Collins, J., & Wunder, S. (2023). Heavy reliance on private finance alone will not deliver conservation goals. Nature Ecology and Evolution; 1-3
- Kedward, K., Ryan-Collins, J., & Chenet, H. (2022). Biodiversity loss and climate change interactions: financial stability implications for central banks and financial supervisors. Climate Policy, 1-19.
- Bezemer, Dirk, Josh Ryan-Collins, Frank van Lerven, and Lu Zhang (2021). Credit policy and the ‘debt shift’ in advanced economies Socio-Economic Review 21, no. 1: 437-478. https://doi.org/10.1093/ser/mwab041
- Chenet, H., Ryan-Collins, J., Lerven, F. van, (2021). Finance, climate-change and radical uncertainty: Towards a precautionary approach to financial policy. Ecological Economics 183, 106957. https://doi.org/10.1016/j.ecolecon.2021.106957
- Campiglio, E., Dafermos, Y., Monnin, P., Ryan-Collins, J., Schotten, G., & Tanaka, M. (2018). Climate change challenges for central banks and financial regulators. Nature climate change, 8(6), 462-468.
- Book chapters
- Ryan-Collins, J. (2022). Financial regulation, uncertainty and the transition to a net-zero-carbon economy. In L. -. P. Rochon, S. Kappes, G. Vallet (Eds.), Central Banking, Monetary Policy and the Environment. Elgaronline. https://doi:10.4337/9781800371958.00016
- Kedward, K. and Ryan-Collins, J. (2022). A Green New Deal: Opportunities and Constraints, in: Arestis, P., Sawyer, M. (Eds.), Economic Policies for Sustainability and Resilience, International Papers in Political Economy. Palgrave Macmillan, Cham.
- Working papers
- Ryan-Collins, J., Kedward, K., & Chenet, H. (2023). Monetary-fiscal policy coordination: Lessons from Covid-19 for the climate and biodiversity emergencies. UCL Institute for Innovation and Public Purpose WP, 2023/4, https://dx.doi.org/10.2139/ssrn.4419077
- Kedward, K., and Ryan-Collins, J. (2022). From financial risk to financial harm: exploring the agri-finance nexus and drivers of biodiversity loss. UCL Institute for Innovation and Public Purpose, Working Paper Series (IIPP WP 2022-05).
- Kedward, K., Gabor, D., & Ryan-Collins, J. (2022). Aligning finance with the green transition: From a risk-based to an allocative green credit policy regime. Available at SSRN 4198146. https://dx.doi.org/10.2139/ssrn.4198146
- Kedward, Katie and zu Ermgassen, Sophus O. S. E. and Ryan-Collins, Josh and Wunder, Sven, Nature as an Asset Class or Public Good? The Economic Case for Increased Public Investment to Achieve Biodiversity Targets (December 19, 2022). Available at SSRN: https://ssrn.com/abstract=4306836
- Ford, G., Kedward, K., Krebel, L., Ryan-Collins, J., Vaccaro, J., & van Lerven, F. (2022). Fat Tails, Tipping Points and Asymmetric Time Horizons: Dealing With Systemic Climate-Related Uncertainty in the Prudential Regime. (October 12, 2022). Available at SSRN 4245871
- Mikheeva, Olga and Ryan-Collins, Josh, Governing Finance To Support The Net-Zero Transition: Lessons From Successful Industrialisations (January 21, 2022). UCL Institute for Innovation and Public Purpose, Working PaperSeries (No.WP 2022/01). Available at: https://www.ucl.ac.uk/bartlett/public-purpose/wp2022-01
- Kedward, K., Ryan-Collins, J. and Chenet, H. (2020). Managing nature-related financial risks: a precautionary policy approach for central banks and financial supervisors. UCL Institute for Innovation and Public Purpose, Working Paper Series (IIPP WP 2020-09).
- Policy briefs and reports
- Marsden, L., Ryan-Collins, J., Abrams, J., and Lenton, T. (2024). Ecosystem tipping points: Understanding risks to the economy and financial system. UCL Institute for Innovation and Public Purpose, Policy Report 2024/03. Available at: https://www.ucl.ac.uk/bartlett/public-purpose/2024/apr/ecosystem-tipping-points
- Kedward, K, Gabor, D. and Ryan-Collins, J (2022) A modern credit guidance regime for the green transition, SUERF policy note, no 294.
- Kedward K, Ryan-Collins J, Chenet H, van Lerven F. (2022). Developing a precautionary approach to financial policy – from climate to biodiversity. The London School of Economics and Political Science, INSPIRE Sustainable Central Banking Toolbox, Policy Briefing Paper. Available at: https://www.lse.ac.uk/granthaminstitute/wp-content/uploads/2022/04/INSPIRE-Sustainable-Central-Banking-Toolbox-Policy-Briefing-Paper-2.pdf
- Kedward, K., Buller, A. and Ryan-Collins, J. (2021). Quantitative easing and nature loss: exploring nature-related financial risks and impacts in the European Central Bank’s corporate bond portfolio. UCL Institute for Innovation and Public Purpose, IIPP Policy Report (IIPP 2021/02). Available at: https://www.ucl.ac.uk/bartlett/public-purpose/pr21-02
- Kedward, K., Ryan-Collins, J., Chenet, H., 2021. Understanding the financial risks of nature loss: exploring policy options for financial authorities (No. No. 115), SUERF Policy Briefs. SUERF: The European Money and Finance Forum. https://www.suerf.org/suer-policy-brief/27301/understanding-the-financial-risks-of-nature-loss-exploring-policy-options-for-financial-authorities
- Ryan-Collins, J. (2019). Beyond voluntary disclosure: why a ‘market-shaping’ approach to financial regulation is needed to meet the challenge of climate change [Online]. SUERF: The European Money and Finance Forum. https://www.suerf.org/docx/f_a821a161aa4214f5ff5b8ca372960ebb_4805_suerf.pdf.
- IIPP blogs
- Media and events
- IIPP researchers outline the role governments should take to deliver global biodiversity targets: https://www.ucl.ac.uk/bartlett/public-purpose/news/2023/jun/iipp-researchers-outline-role-governments-should-take-deliver-global-biodiversity
- Governing finance for people and planet: https://www.ucl.ac.uk/bartlett/public-purpose/events/2023/may/governing-finance-people-and-planet
- Sustainable to Regenerative: https://www.ucl.ac.uk/bartlett/public-purpose/events/2022/nov/sustainable-regenerative
- Green central banking: https://greencentralbanking.com/2022/12/13/fossil-fuel-financing-capital-regulation/
- Phenomenal world: https://www.phenomenalworld.org/analysis/two-price-economy/
- Summary of research news coverage: https://www.ucl.ac.uk/bartlett/public-purpose/news/2020/oct/latest-iipp-paper-argues-nature-related-financial-risks-more-complex-climate-risks
- Project syndicate op-ed: https://www.project-syndicate.org/commentary/central-banking-green-transition-climate-change-by-mariana-mazzucato-et-al-2020-12
- Guardian feature: https://www.theguardian.com/environment/2021/jan/28/how-much-is-an-elephant-worth-meet-the-ecologists-doing-the-sums-aoe
- Katie Kedward gave evidence on the proactive policymaking for the green transition to the UK Trade and Business Commission https://www.youtube.com/watch?v=jYKiVJ69vYc
- Josh Ryan-Collins writes on the role of central banks in supporting a green transition in The Guardian https://www.theguardian.com/commentisfree/2020/may/26/banks-uk-recover-coronavirus
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