Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said central banks should intensify and increase climate change response and be at the forefront in the transition to a low-carbon economy.

BSP Governor Benjamin E. Diokno

“We need to take advantage of the momentum calling for action, and step up our response towards climate change,” said Diokno on Wednesday, Nov. 10, commenting on central banks’ contribution to the 26th United Nations Climate Change Conference of Parties (COP26) summit in Glasgow, Scotland.

The BSP is part of the Central Banks and Supervisors’ Network for Greening the Financial System (NGFS) since July last year. It is the goal of NGFS to achieve global climate goals under the Paris Climate Agreement.

“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,” said Diokno.

The BSP said that as a member of NGFS, it has committed to support and promote financial system sustainability agenda under the Sustainable Central Banking (SCB) Program for an environmentally responsible and sustainable policies and work practices.

The BSP has also committed to do the following: provide an enabling regulatory environment to equip banks in managing climate change, environmental, and social risks, and at the same time, unlock financing to economic activities contributing to sustainable development; and to facilitate 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.

The BSP is promoting a collaborative approach to harmonize policies and align initiatives with the objectives and strategies of the Philippine Sustainable Finance Roadmap and Guiding Principles. It also aims to build partnerships to intensify awareness and capacity-building activities for the financial sector.

Diokno has said that the BSP is completing various initiatives under the SCB Program to “embed sustainability principles in the BSP’s operations and functions.”

“While multiple efforts are underway to rethink and reset banking strategies to meet the expectations under the framework, there is an undeniable need for a clear and strategic direction from the government side,” he said.

Source: Manila Bulletin (