THE Bangko Sentral ng Pilipinas (BSP) announced on Wednesday that it is joining the Central Banks and Supervisors’ Network for Greening the Financial System (NGFS) and its members in supporting the attainment of global climate goals under the Paris Climate Agreement.
The statement was made in light of the 26th United Nations Climate Change Conference of the Parties (COP26) summit in Glasgow, Scotland.
“Central banks and financial institutions should recognize their important role in contributing to the transition to a low-carbon economy. As stewards of the financial sector, we should all commit to act with urgency in achieving the desired emissions reduction targets and in promoting the sustainability agenda,” BSP Governor Benjamin Diokno said in a statement.
In July 2020, the BSP became a plenary member of the NGFS—a group of central banks and financial supervisors that voluntarily exchange experiences and best practices to enhance the financial sector’s environment and climate risk management and accelerate the transition towards a sustainable economy.
“We need to take advantage of the momentum calling for action, and step up our response towards climate change,” the governor said.
Among the commitments under the agreement include pushing the sustainability agenda in the financial system, providing an enabling regulatory environment to equip banks in managing climate change, environmental, and social risks, and facilitating the conduct of climate stress-testing exercises and collection of more granular data on climate, and environmental and social risks exposures in the banking industry.
Earlier this year, the BSP established a Sustainable Central Banking Roadmap. This will provide the framework and milestones in the adoption of sustainability principles in key operations of the BSP.
In this roadmap, the governor said the BSP adopts three roles—as enabler, mobilizer, and doer—in advocating sustainability in the financial system.
Among the other commitments are the promotion of a collaborative approach in the financial sector and building partnerships to intensify awareness and capacity-building activities for sustainability.