At a minimum, as the guardians of financial stability, we want the financial system to remain resilient to the risks posed by climate change, so that it is capable of supporting the transition to net zero. One thing is very clear. Central banks – including the Central Bank of Ireland – cannot solve the problem of climate change on their own.
The challenge requires action on the part of the whole community, of businesses, households, and the entire financial system as well as policymakers. The insurance industry is at the front end of physical risks and they really matter for the transition given the role in channelling savings to support investment.