Øystein Børsum: Ownership and climate risk in the Government Pension Fund Global (GPFG) – on the tools for addressing climate risk in the fund Speech by Mr Øystein Børsum, Deputy Governor of Norges Bank (Central Bank of Norway), Oslo, 21 December 2021. * * * Accompanying presentation:www.bis.org/review/r212312d_presentation.pdf Actual presentation may depart from the published text  Introduction Climate change is an issue that matters. Chart: Emissions must come down The global economy as it stands today is not sustainable. But it needs to be, and so emissions must come down. This is an issue for everyone – and not least the fund. With our broadly diversified, global portfolio and long-term horizon, in many ways we stand or fall with the global economy. Norges Bank is a financial investor. Our mission as the manager of the fund is to build and safeguard financial wealth for future generations. But the way we manage the fund can also have an impact beyond the purely financial, such as on the transition to a low-carbon economy. What our role should be – and what our work should involve – is what I will be discussing today. Back in the summer, an expert group delivered its report to the Ministry of Finance with recommendations for how climate risk should be addressed at the fund. Norges Bank has spent the autumn assessing these recommendations and how they might be implemented. This week, the Executive Board submitted its response to the Ministry.
The global financial crisis significantly undermined confidence in the financial system, and the discovery of ethical lapses that continue to be reported today has further eroded public trust in financial institutions. There is an urgent need to restore faith in the utility of financial services, firstly through the demonstration of fair and responsible practices and reinforced with the provision of valueadding products and services that are meeting the real needs of consumers and businesses. Financial institutions with their extensive reach and customer relationships are in a unique position to have a more significant role in advancing the financial education agenda. In Malaysia, this has included providing technical support and materials for teachers to improve their knowledge and increase confidence in teaching financial matters in schools. Financial institutions have also adopted more than 10,000 schools across the country under the School Adoption Programme with wide ranging activities in money management for the children. The financial institutions also work closely with the Credit and Debt Management Agency in the implementation of financial education programmes for adults. Today, the focus on financial capability has become a global agenda. This has provided opportunities for policymakers to learn from their peers across countries and leverage on the international network of expertise in addressing common issues and challenges. This Symposium is a great example of realising such opportunities. The possibilities for meaningful cooperation at the regional and global levels are tremendous. This has already included research, technical assistance and guidance for policymakers.