 Hello my name is Nick Robbins I'm Professor in Practice of Sustainable Finance at London School of Economics at the Grantham Research Institute. I'm delighted to welcome you all today for this webinar to explore the new publication, a toolbox for sustainable crisis response measures for central banks and supervisors. This is a joint publication by the London School of Economics and SOAS, and I'll be joined by my co-authors Simon Dickow and Oli Volts. This is produced through the INSPIRE program and that's the International Network for Sustainable Finance Policy Insights Research and Exchange, which is a network to deliver cutting edge research to help central banks green the financial system. And I'm delighted to co-chair INSPIRE along with Elmy Groundhoff from the Climate Works Foundation in the US. So today we have a great lineup for you. After I've said my introductory words, my co-authors Oli Volts, who is the Director of the SOAS Center for Sustainable Finance and Simon Dickow, my colleague at the LSE Research Officer and Manager of INSPIRE, they'll go through the key findings and recommendations of the toolbox. And then we're delighted to have three very distinguished panelists to respond and give their expert views about how central banks are dealing with climate and green finance issues in the crisis, where the toolbox could be useful for central banks and supervisors, and what we need to focus on next in terms of priorities for action. The first panelist will be Luisa Wasu Pereira de Silva, who is Deputy General Manager of the Bank for International Settlements. Also co-author of one of the best green finance reports out recently, the green swan, and Luisa will be delighted to hear that that was mentioned on our Asia webinar by Professor Ang Yao from Beijing University this morning. So welcome, Luisa. We'll then have Rafael Delvila Ari, who is the advisor to the Governor of the Bank of Mexico, the Bank of the Mexico, and the veteran of G20 green finance and other issues. And then also Sonia Gibbs, Managing Director and Head of Sustainable Finance at the Institute for International Finance, really becoming one of the key hubs for private sector sustainable finance thinking. So that's the lineup. Then there'll be an opportunity for you on the call to ask your questions. Please put your questions and your comments in the chat function. I will then draw from those. We won't unfortunately have the opportunity for you to give your questions verbally. This is going to be a recorded webinar and we'll make the links available for you to share afterwards with your colleagues and others. So, without more ado, I'd like to hand over to Uli Volts to start us off and take us through the toolbox. Over to you, Uli. Thank you, Nick, and welcome everyone. Before I start the presentation with Simon, I just want to highlight that this webinar is part of a research project on sustainable crisis responses of central banks and financial supervisors, which is supported by the Inspire Network. And this project is jointly led by E3G, the Bennett Institute for Public Policy at Cambridge University, the Season Center in Kuala Lumpur and the Surah Center for Sustainable Finance. And there will be quite a lot of interesting events relating to this topic coming up over the next couple of months. So, as mentioned, we will present now the toolbox. Which was a quick attempt to respond quickly to the crisis, give some guidance, recommendations to central banks and supervisors in how to shape their responses in a sustainable way. And we've had quite a bit of interaction with the NGFS and individual institutions in working on this. Central banks and supervisors are clearly playing a very important role in the current crisis response, and this relates both to the immediate stabilization phase where we're still in, and this will also extend to the recovery phase. And it's important to highlight that the policies that are adopted during the crisis will in many cases have very profound implications on long term outcomes. So it's therefore important that the crisis response measures, even though they are geared towards short term immediate pressures, need to be consistent with long term climate and sustainability goals. And also that the responses are aligned with a just transition to a sustainable economy. There are, broadly speaking, four reasons why central banks and supervisors ought to incorporate climate and sustainability factors into their crisis responses. First of all, central banks need to make sure that they themselves don't load up all kinds of climate risk into their balance sheet in their current actions. Of course, we know that central banks can't go bankrupt, but they need to be leading by example. The NGFS has made very clear that climate risks are a source of financial instability and central banks in their current operations that need to take this into account and this matters of course in particular for the corporate asset purchase programs which need to take climate risk into account. Secondly, central banks and supervisors need to make sure that the financial institutions, a supervised will not build up all kinds of climate or sustainability risk in the current situation when they're extending credit to keep the economy afloat. And of course, as guardians of macro financial stability, central banks and supervisors also need to have a look at systemic financial stability and the economy at large and I need to make sure that the new credit and financial flows that are being created now don't build up additional risk in the system. And last but not least, as public bodies, central banks and supervisors should be supporting the move towards a sustainable financial system that is aligned with a Paris Agreement and sustainable development goals. So the prudential aspect is really important. Central banks are right now creating enormous amounts of liquidity to keep the economy and the financial system afloat and also financial supervisors are using counter cyclical prudential instruments and this is very important indeed to keep the economy alive, support financial stability, but it's important that these actions don't lead to the build up of new sustainability related risks in portfolios and balance sheets. So it is very important that the discussion central banks and supervisors have developed over the past couple of years about incorporating climate and other sustainability risks into their prudential actions are not stopped now. Of course, we're in a crisis situation. So one has to be very careful with overburdening financial institutions with all kinds of new regulations, but we also need to be aware that the climate crisis we are already facing is not giving us a luxury of waiting another five years to get serious about climate risk. Next one please. Yeah, so luckily there are quite a lot of tools and instruments and both central banks and supervisors can use to calibrate their crisis responses in a climate and sustainability aligned way. And I'm just going to mention four important ones and Simon will then go through details of the toolbox. So first of all, central banks can adjust collateral frameworks to account for climate and other sustainability related financial risks by applying, for example, haircuts or excluding assets that are not aligned with sustainability goals. Refinancing operations can be aligned with sustainability goals. Certainly reserve requirements and risk weights can be differentiated to account for climate risk or other risks. And last but not least, asset purchase programs could be, and I would very strongly suggest should be excluding carbon intensive assets. In order to avoid a situation where central banks provide a new lifeline to an industry which is really at the core of the problem in the climate crisis. I'll hand over to Simon. Yes. Thank you very much, Oli. I would like to quickly walk you through our toolbox in some detail. Well, first of all, of course, this toolbox has been informed by global experience. So we are very much aware that there's no one size fits all approach and our toolbox reflects differing financial cultures, policy spaces and objectives of central banks and supervisors around the world. So there are there are two important aspects here. First instruments that are seen as standards by some central banks may of course not be conventionally used by other central banks. And then secondly, central banks and supervisors across different jurisdictions operate within very different mandates and legal frameworks. So keeping this in mind, we have three overall areas in our toolbox, namely monetary policy, prudential policy and other. And within these three areas, we have nine policy instrument categories. So for each of these of these categories or for each of these instruments, actually, we point out how convention conventional sustainability blind calibration looks like well currently looks like and how these instruments could be employed with the sustainability enhanced calibration. So the first category that we have is monetary policy. Here we have three subcategories namely collateral framework indirect monetary policy instruments such as open market operations and reserve requirements. Then we have non standard instruments including asset purchase programs, helicopter money, or even monetary financing. And then finally we have direct monetary policy instruments, some of which can of course be used to to affect the allocation of credit. So for most of these instruments, there, there are specific suggestions already for how they could be aligned with sustainability codes. Well, while for others, for example, collateral frameworks, these details are still being worked out. There's there's also inspired ongoing inspire commissioned research on on collateral frameworks, for example. And the second category that we have is financial regulation and supervision. Here we have micro potential instruments, including stress tests disclosure and other bars or three instruments. These can of course be aligned or can be calibrated to take account of environmental and climate change related risks. For example, climate stress tests mandatory is G disclosure and the climate risk sensitive calibration of, for example, differential risk based capital requirements would be an option here. In the macro potential instrument category we differentiate between cyclical instruments and cross sectional instruments, which could of course also be calibrated to take systemic climate risk or environmental risk into account. Then finally, other policies. Here we have further financing schemes and initiatives such as corporate financing facilities or loan guarantees and financial sector bailouts, which could be made conditional on the reduction of CO2 emissions or the focus on sustainability enhancing activities. Then we have the management of central bank portfolios where disclosure of climate related financial risks could be could be an important first step for central banks to take. The BIS also has a very nice paper on central banks foreign exchange portfolios and the relevance of climate risks. And then finally, we have supporting sustainable well support for sustainable finance activities, which should be rolled out and not not be delayed in face of the crisis. Yes, the emerging evidence base so we tested our classification and toolbox empirically. We looked at all currently used crisis response measures that have been implemented by central banks and supervisors in countries with at least one and GFS member institution. And our investigation is based on the IMF's policy tracker. We looked at around 60 countries and an interesting finding is that most, if not all of the instruments that we propose in our toolbox are currently used by central banks and supervisors, but not with a sustainability enhanced calibration. And then we moved to two different instruments while on monetary policy we found that many central banks have moved quickly to extend their collateral frameworks to include a broad variety and quality of assets. So that that has been implemented by quite a few central banks and in that we looked at. And then secondly on supervision many central banks and supervisors have east counter cyclical capital buffers and general micro potential regular standard. So these are two key findings. And while we have not been able to to identify any monetary or prudential crisis response instruments that have been calibrated in a sustainability enhanced way. There are of course also some positive examples of monetary and financial authorities that are advancing sustainable, their sustainability agenda despite the challenges of COVID-19. For example, they are ongoing efforts in China, then there has been the launch of a sustainable finance of a sustainable finance committee and frameworks in Mexico and in the Philippines. BCB has of course joined the the NGFS earlier this year. And then they have been, well, numerous reports have been published by the NGFS by the ECB by the Montefrance. So in this in this last category, this is where we find currently a lot of activities. Two interesting initial conclusions from this from this report. First, many changes have not been well many policy changes have not been fully implemented yet. In fact, nature therefore provides considerable scope for central banks and supervisors to retrofit sustainability factors into their crisis response instruments and broader policy measures. And then secondly, this policy response also demonstrates, we would argue that a broader set of instruments is potentially at the disposal of central banks and supervisors. And this to some degree renders the ongoing debate redundant regarding the availability of the availability of a number of these rather unconventional measures. Because some of these of these instruments are currently used well that are currently used have been discussed by central banks and supervisors in the past as not being suitable to allow to allow addressing the greening of growth and economies. Yes, and quite a few of these of these rather unconventional or unconventional instruments have now been used, or have been calibrated to support specific sectors mostly the SME sector. And, well, this for us bears the question of whether this creates some kind of policy space and an opportunity to green central banking and scale up green finance now, and to further include climate risks into into binding regulation. And one last slide we have so we are planning to have one more webinar in July. The date will be announced soon to also discuss this this this toolbox with an European framework. That's it from my side over over to Nick and the panelists. And Simon very good overview is like to pick up that last couple of comments as you made Simon that I think because of the dynamic nature of this crisis that we have before us in terms of the economic shock of COVID. There are some opportunities for central banks supervisors to incorporate sustainability and climate factors in in perhaps the next phase. And also there's been an interesting demonstration of many of the tools that are in the toolbox, potentially giving some opportunity to add a green dimensional next in the next round. We're going to move to the to our panelists are three panelists. And, Luis, if I can turn to you. Have you very good to have your views on how you see central bank supervisors, trying to think about climate green finance issues in crisis, your views indeed on the on the toolbox, and perhaps sort of where you would focus attention in terms of this. Over to you for the first wire. Thank you. Thank you. Thank you, Nick. Look first. Thank you for having me in this, this webinar and I congratulate the work of inspire of you and your colleagues on on putting together this, this, this paper. I see a lot of in terms of the mapping of this toolkit. Some similarities between work I think as. Simon pointed out this work and some of the areas of interest of the NGFS, particularly the last report of last of this month actually on the monetary policy channels with which this can be used to contribute to fighting climate change. My take, guys, is that we are, I mean, we ourselves looked at the issue before the crisis, I mean the way in which central banks were interested or should be interested in climate change related risks was analyzed by by us before COVID-19 in the more broader context and what we perceive where the mounting physical and transition risk that we're appearing in financial markets and because of the financial stability mandate of central banks. They had a particular interest in looking at these risks. And we, the angle we took. And this is perhaps one of the difficulties that Simon pointed out is that we wanted to make sure that in addressing these risks related to financial stability. This would not become the sort of only gaming time again for for climate change related risks. Why is it so, because our approach pointed to the need for a broad and compassing coordinated approach to many actors pulling together in the direction of designing policies that would have a financial stability component but would need to have many other dimensions of coordination, particularly with the private sector governments using instruments that would go let's say beyond even the toolkit that you have pointed out. Perhaps one of the delicate balances that you yourself point to which is the fact that some some instruments that are in your toolkit do exist, but are not necessarily used today with a calibration for policies that are directly related to climate change is precisely because of this need that we pointed out to not to focus or not to put excessive burden into the community of central banks but to try to balance the response in a broader array of instruments that would involve more responsibility to governments, fiscal policy, civil society, and so on and so forth. So I think in a nutshell guys that the jury is out whether you can sort of create a balance where the central bank community would indeed look into climate change related risks and that in terms of their financial stability mandate and pick some of the instruments in your toolkit that certainly address this financial stability concern and mandate, for example, in terms of disclosure of risky assets in terms of some of the micro potential and micro potential tools that you have identified but would not necessarily venture into going I think who it was advocating very strongly for let's say green QE but my take here is that the community has especially resisted going to this direction because of let's say the excessive or the additional distortion that this might create the fact that it would be perhaps in some cases counterintuitive to have expansionary policies and accommodative policies that would be selected to specific categories of assets and types of delicate balance that is sort of a more aggressive use of the tools at the hands of the community would would create in terms of market perceptions and market reaction. Okay, so my take here is that because of this complex then the way in which we thought of this was to try to look at some of the tools that would sort of or the areas that would be compatible with central bank mandates would help address climate change related risks but would still make sure that do not necessarily put the the central banking community in the exclusive driver seat so let me give you some examples where the work and again it's not contradictory with having a map a very detailed toolkit as you as you put out it's just like the way in which the tools are used and the rationale behind using them and the rationale that makes sure that it's coordinated with other policies. For example the capacity for central banks to improve their modeling of climate related risk, physical risks and transition. How do they transmit into the financial systemic risk in markets? The way in which you can you can design portfolios with a green premium with this and to a broader extent with ESG criteria that would be also a way to sort of factor in a lower carbon print type of portfolio for financial institutions the way in which for example you look at the work of reputation and disclosure into the pricing of assets. So many things that are happening in the BASA committee in the financial stability board in the NGFS in the central bank community that certainly picks on some of the tools that you have in your toolkit but do not necessarily put the responsibility of using in a very specific way and explicit way some of the tools that are meant to be of a broader use because of this political economy argument where by doing that by becoming a sort of driver in the process rather than a part of a more coordinated approach that encompasses particularly fiscal policy and carbon pricing which are decisions that do not pertain to central banks you would to some extent be undermining the whole I mean not necessarily undermining is a bit of a strong one it's rather sort of not necessarily being the best incentive in this necessary effort that all of us have to make to combat climate change. So I stop here. Thank you Lisa, thank you very very profound comments I think and I think one of the interesting themes at the moment is obviously a number of countries are not just introducing sort of crisis stabilisation measures but now thinking about longer term recovery plans and I think that's potentially where we do obviously see potential for that broader coordination between fiscal policy both on the spending side but also potential introduction of carbon pricing on the capital on the revenue raising side so thank you for those Rafael if I may turn to you in Mexico City I can see your tree outside your window if you could give us your thoughts sitting inside a central bank and how you're looking at linking these two agendas of sort of crisis response and green finance and your views indeed on the toolbox itself thank you well thank you very much Nick and thank you everybody for this invitation and great opportunity to be with you yes I very much like this tool and so congratulations for bringing this discussion forward and I think it's very very useful and timely I think we coming from an emerging market economy I think it's I would like to start stressing the third term the three other policies the number three that you have in the toolbox called other policies because and in particular focusing on the last of the other policies which are called supporting sustainable finance and I think it's important for central banks as Luis mentioned that we are not doing this alone in any way that we are coordinated with other financial authorities and with the private sector in doing that and I think there are of course by now significant examples of that in the UK and other parts of the world so this is a very fundamental point because you have to sort of start building the institutional setup and the policies that are the competence of different authorities so this is a little bit of a repetition but it should be particularly in emerging markets so at the concluding the concluding recommendation that the Bank of Mexico issued when presenting its quarterly report and this was done late April was that the micro-economic functioning of the economy needs to be strengthened and domestic uncertainty to be reduced in order to improve the country's business perception and I think this last recommendation in the quarterly report is very fundamental because you tie that to the that was already mentioned that climate change is a source of financial stability and that financial systems play a crucial role in protecting economic activity of course this is a role of insurance but very clearly insurance just to make an example can impact allocation of investments to support the internalization of externalities so for instance policies gearing up towards avoiding catastrophes by firms say mining firms to put an example insurance can play a fundamental role in making increasing awareness of the corporates of the risk of catastrophes and therefore on the type of investments and asset allocations that are needed within the corporate to precisely reduce the probability of such catastrophe so this is an example that I am putting of the insurance and when we are looking at risk management in general this is precisely the same transmission mechanism that we have namely the proper accounting of brown and versus green assets of the proper accounting of risk differential and uncertainty of the assets involved within the two assets supports will support a change in the asset allocation that is ultimately the goal of the toolbox so let me just briefly show transmit to you the logic that was made in creating the sustainable finance committee and that was presented to the financial stability council in the country at the end of March and whose rules of operation are currently in the process and probably even today will be approved so the idea behind this financial stability committee is part of the sorry the financial sustainable committee being part of the council for financial stability was that we wanted to have a look at not only as a reaction to risks short term risks but we wanted in this financial stability council looking at longer term risks affecting the economy and also and in doing so and we the notion was put forward that we need a central it is very important precisely to develop a sustainable finance roadmap and to inform the infrastructure and instruments that should be available in Mexico's financial system and by infrastructure I mean and the taxonomies the disclosure and reporting and so going to just on the side mentioning briefly the the report that was issued in the second half of May this last past month this was a UN and one of the conclusions is that we were surprised that the TCFD recommendations for instance were very you know we expected them to be very well known are known only to 75% of credit institutions and to a little bit less than half of asset managers in the country so basic and so we have committed is to push forward an agenda of capacity building and transparency disclosure along the lines of the TCFD this is of course going to be a fundamental part of the sustainable finance roadmap and going forward and so all this to say that a lot has to be done in terms of building the stone the core the basic stones of the building and the basic stones of the building are precisely this using looking also to leverage the certifiers the second opinion providers and the third opinion providers are the most ecosystem of corporates that give credibility to and assess the the allocations the asset allocations and just to finish a quick comment and probably should receive further highlight within the toolbox because it is not that we are sort of looking at this issue as a value proposition it is we're looking at the issues in the toolbox because they are they make sense they are they are fundamental to the analysis and so when when you propose collateral frameworks or you discuss collateral frameworks or you discuss you know a microprudential or microprudential instruments I think should be very much embedded in this concept of financial materiality and thank you very much and I stop with you. Very good Raphael very very interesting comments and it's good to have the updates about actually what's happening in in Mexico and good to see that your new initiative has not been kicked off course or blown off course by the crisis itself and you've kept going which is very good so Sonya if I could come to you last of our respondents clearly you're sitting at the IF really a hub of thinking from the private sector views on these things many obviously many of your members and yourselves have been thinking very deeply about crisis response it'd be good to get your perspective essentially at one step removed perhaps from the direct sort of central banks on this on this agenda and indeed your thoughts on the toolbox and where you would prioritize so Sonya over to you please thank you. Thank you Nick and indeed you know I think one of the most striking things in in response to the toolbox paper in the discussion today has been the continued focus and momentum on sustainable finance in the policy and regulatory community it's really quite quite astonishing considering how much else has to be done with pandemic response so but I wanted to start by saying that central banks and supervisors in many ways of course been bracing for this type of crisis for for some time now on different levels both in terms of traditional risk to financial stability you know debt overhang credit risk and so on but also these newer climate related risks and I feel it's incumbent upon me to say on the financial stability front of course the reforms that were put in place after the last crisis have helped contain systemic risks and the financial sector is better buffers in place and so on and on the climate front here I would sort of highlight of course the work of the central banks and supervisors network for greening the financial system in laying the groundwork for addressing these climate risks the new guides for supervisors the climate scenarios as was discussed and just had just come out the different work streams on supervision macro financial risk mainstreaming sustainable finance you know all of this is very helpful to firms in developing a framework for assessing disruption from climate and broader ESG risk so for example in a COVID context you could think of these in terms of shocks to food supply chains for example so all of this has been tremendously helpful and the the more recent work of course on ensuring the private sector can effectively generate the kind of information that's needed for supervisors for risk assessments so this focus on better disclosure and better reporting and here I would sort of emphatically second the remarks that Rafael made on financial materiality very very critical as we at the IIF and our members are very much of a focus on the need for global alignment in sustainable finance policy and regulation I'd also highlight the role of the traditional standard setters so the bowel committee on banking supervision the new task force on climate related financial risks the work of the FSB the IAIS on insurance side IOSCO all of this we feel is is fundamental to making a well aligned global framework I'd highlight IOSCO as well on emerging markets because I think that's a dimension that's often overlooked in these discussions with so much of the focus being on conditions in in mature markets the setting for emerging markets especially if you want to build back better you know it's critical to avoid very carbon intensive recovery which is the traditional model for for many emerging markets so just to highlight that there on the the monetary policy front I think another lens for exploring this crisis response you know it's fair to say that very little has been done to date on using monetary policy tools to achieve specific sustainability objectives so your toolbox in this context I think is is is very helpful you know when you look at the broader fiscal response to the to the crisis to date if you do all those calculations probably less than than 1% has been allocated toward a specific green objective so highlights the distance we have to travel I did however want to highlight some of the findings from a recent survey of reserve managers that we did with Morgan Stanley just kind of been encouraging in in how central banks are looking at their own work and in greening their own portfolios first to say that over half of the reserve managers we surveyed are members of the NGFS or TCFD or considering becoming a reserve manager or so half of the respondents of these reserve managers already manage green social or sustainability linked bonds and many intend to increase their exposure in the next couple of years and many are considering ESG as an additional dimension for their liquidity and returns and capital preservation framework and finally many of the reserve managers are beginning to look at the sustainable investing goals as part of their reserve management strategy so I think the in the context of the toolkit that you've laid out I think some of these elements are beginning to come together just in you know aside from the sheer admiration from all of the work that's gone into this toolkit a lot of very interesting proposals so congratulations it's very ambitious clearly setting out ways for central banks to become more actively engaged in directing capital to climate friendly economic activities and here I think it's quite important to emphasize the political dimension to this right because in order for this to happen there has to be the political will to do so and another factor to take into consideration is the classic tragedy of the horizon question you know we still don't have the data and the tools to quantify these risks and put them in the here and now you know so making a clear case for urgent action and so what you're doing is is really geared toward effectively extending the mandate of central banks and again you know the political will to do this in a globally aligned manner will be will be very important risk weights and potential treatment I highlight some key missing fundamentals just a few here the the data gaps climate risk assessment being evolving a very nascent field we still need to build agreement on metrics and methodology otherwise you're comparing apples oranges and bananas in different jurisdictions and makes it very difficult to to build that sound policy framework the lack of consistent definitions both around what is sustainable finance for example from the point of view of a bank doing landing activities but also in the investment space you know there are hundreds of definitions of sustainable or responsible investment so important to to bring those together and all that of course feeds into the lack of a coherent disclosure framework so another very important point and really sort of delved into this but sort of as on a related note a central issue is the lack of a global carbon price so without that you know making the risk assessment of risk differentials obviously becomes much harder when you don't have that and finally we'd be cautious on the notion of green supporting brown penalizing factors and again for some of these same reasons around the missing fundamentals for a common understanding of what green is what brown is and what's in between so as you say in the report a lot of very interesting work ahead so on the what next and recommendations I would just sort of make three main messages here first of all you know we don't expect and would not anticipate any kind of a return to a pre-crisis sustainable finance policy agenda clearly it's going to be broadened many of the elements of the toolkit that you set out are geared to to move toward the mainstream and but we would advocate that these bill be built out in collaboration with industry so in this very new and evolving field of climate and environmental risk assessment doing it in collaboration is going to produce much better outcomes we're still in the learning by doing stage and second is to to really guard against the risk of fragmentation or lack of alignment in the supervisory framework a lot of individual institutions are undertaking independent climate risk assessment efforts kind of a climate arms race you might say it's good to have healthy and positive competition but too much too much divergence in objective design considerations and methodologies are really going to make it hard especially for global firms that operate in multiple jurisdictions so avoiding fragmentation is key and finally I think you know investigating and building out new instruments vehicles to factor ESG considerations into debt markets more broadly including importantly in the context of debt sustainability so scaling up the use of things like social bonds transition bonds SDG bonds and so on really growing these markets in support of sustainable growth so well done it's great great report thank you well Sonya thank you so much for closing on those those comments from yourself and Raphael and Louise we one thing I've learned from all these things that time is a non-renewable resource and we have about seven minutes to go I would be interested actually Simon on your brief reflections just on what you've heard from our speakers we've had a couple of very interesting comments I think from the chat at University of Waterloo in Canada really talking about how do we convince central banks about sustainability at time of crisis and also from Stephen Rothstein at Ceres I believe in Boston should be recommendations in the toolbox we should prioritise and then I'll come back to the three panelists at the end and then there's a very good question from Kevin Gallagher which I'll try and pick up as we close but there's a couple of comments from you and then I'll come back to the three panelists and then we'll finish up thank you okay I'll take over thanks so much to all the discussions there's really a lot of stuff in there just a few points so first of all I'd like to clarify Louis said I was not advocating green QE in fact I have been very long arguing that green QE is not really what we need so what I have said is that central banks when conducting asset purchase programs should be excluding very carbon intensive assets so that's the distinction it's not green QE which I know in the central banking community is a non-starter and also I mean if we look at the green bond universe you know there isn't really enough green bonds anyway but there is a very important problem when we have the most important central banks in the advanced world who have very substantial asset purchases like fossil fuel companies and so on so I think this has to be addressed I would also like to very much echo the point Sonja made about the need for disclosure and I would indeed argue that right now is the moment where central banks and supervisors should make clear their plans to make disclosure mandatory very soon so and this is an important point more generally I think we all agree that this point in time it's difficult to put all kinds of new burdens on financial institutions but it's very important that central banks and supervisors lay out a clear pass and this pass has to include mandatory disclosure because without a disclosure of climate and other sustainability risks we will be having these discussions about well we can't really do anything unless we have these data and so it will take ages and we do need these data so mandatory disclosure has to be part of the strategy and also setting out very clear timelines regarding climate stress testing so supervisors need to set very clear expectations and this will have anticipatory effect so financial institutions if they are being told if they are being told from next year on you'll have to report to your supervisor what you have in your balance sheet then of course this will affect current lending and investment decisions so that's a very important point on Kevin Gallagher's point I know Nick will pick up on that but I think central banks can do quite a lot to support and many are doing a lot to support the SME sector for example and so there's quite a lot of things special facilities that could be made up for job intensive support with the economy which would be an important element of just transition and the interaction with public finance is also very important and just very final point before Nick cuts me off it's really important Simon mentioned it but we have of course in the world central banks with a lot of different mandates different monetary frameworks and so on so in this toolbox we've put together a list of all kinds of different tools that different central banks and supervisors are using and we're not saying that everyone should be using everything there are different monetary traditions and certainly the Reserve Bank of India is doing certain things that let's say for the Bundesbank would not be really felt appropriate so there are different options and so it's difficult to say well everyone should be doing this or that except for at least rather general points that I made thank you Simon any quick comments? I think you already addressed the major points I'm happy to give the rest of the time to the panel very generous of you I must say Luis a closing thought for you in terms of how we might take this work forward I think what actually the key points having a very useful set of options but understanding that there needs to be coordination I think Sonia said that too with the private sector with governments and therefore let's say it is a joint effort in terms of having partners that work towards the same goal climate change related risk in a way that sort of encompasses and uses the tool with skills but also respecting some of these specificities and mandates of the institutions and actors that have to play a role with all their sort of might and determination but with let's say a complex political economy that we know around the world very helpful Luis thank you Rafael your closing reflections on where we might go next No thank you very much I think very very inspiring I already very much enjoyed also the comments that already made because I think yes and Sonia on disclosure and I would emphasize taxonomy this common language what are we talking about and I fully support Sonia's point in trying to avoid the fragmentation global fragmentation of methodologies and practices at this very basic infrastructure level so I think at least in Mexico we have it pretty clear that we want to be having a tropicalization of these concepts to make them immune to our reality but that we have to be very mindful of where the rest of the world is moving because we the corporates are global and we need to to make sure that we do not impose a cost on this on the system that would be self-defeating thank you Well that was a fantastic phrase I must say Rafael the tropicalization of green finance we're going to have a session specifically on that so thank you very much and Sonia closing the thought from yourself Just to say that being at a point where we have defined climate risk as financial risk has utterly transformed I've been working in this industry for 30 years now utterly transformed the industry we are not going back to pre-climate awareness or pre-COVID measures and now incorporating a social dimension to it post-COVID I think this is really going to emphasize the need for working hand in hand with the public sector to scale up the kind of financing we need to address these risks Well thanks Sonia if I may follow on what you just said to answer the question from Kevin Gallagher about in our paper we touch on this issue of the just transition and I think one of the things we will learn in this post-COVID finance agenda is that the social dimension I think will be stronger we've been working with investors with commercial banks and also with development banks about how they can support a just transition so green objectives with social inclusion as well and my sense is there is a role also for central banks and supervising this not least those central banks who have a dual mandate looking both at financial stability and also employment this is the agenda for us to look at thank you all of you who listening for your questions also for Hugh Cheney who thanks to our panellists and Sonia and really would like to be delighted if you could continue the discussion send us your comments we intend to take this work forward and build on all the comments we've had today so many thanks I'd also like to thank and thank you to all of you who have been helping setting this up and also thank you to all of you who have been behind the setup of this webinar so thanks to everyone and have a good rest of the day thank you thank you bye