Central Banks, Climate Change and Leadership: Women in FICC
-
bookmark
-
print
In the early days of the pandemic, central banks took swift action to help sustain their economies. That type of leadership helped stave off imminent economic panic, but central banks have also taken the lead on addressing the financial risks posed by nonfinancial issues, particularly climate change.
As part of the 16th Annual Women in FICC Industry Forum, we hosted a panel of three central bankers to get their thoughts on climate change and the insights they gained during the COVID-19 pandemic:
-
Nikki Rupert, sustainable finance officer at De Nederlandsche Bank, the central bank of the Netherlands.
-
Marie Gabreau, senior trader analyst secondment at the Bank of Canada / Banque de France.
-
Sabrina Wu, senior trader on the domestic trading desk for the Bank of Canada. Wu served as the moderator for the discussion.
We also discussed leadership in the wake of COVID-19 with Susan le Jeune d’Allegeershecque, who has been Britain’s High Commissioner to Canada since August 2017.
Following is a summary of those conversations.
Central Banks and Climate Change
It’s become clear that climate change presents risks on multiple fronts, including to global financial systems. Rupert explained that the 2015 Paris Agreement was the turning point for the Dutch central bank. Soon after, the bank concluded that climate change posed two challenges: the transition to an energy-efficient economy to help reverse the effects, and the physical risks associated with climate change—such as human displacement—which can also translate into financial risks.
Rupert said De Nederlandsche Bank’s first climate change report, published in 2017, wasn’t universally well received. “At the time some people thought we were crazy,” she said. “Why would a central bank look into these topics? But what we said in that report was that we see these climate-related risks that are relevant to the Dutch financial sector, and we expect Dutch financial institutions to analyze these risks, be aware of these risks and manage these risks if they are relevant for your institution.”
While some critics see the focus on climate change as being too politically charged, Banque de France’s Gabreau noted that the fact central banks had to respond to the pandemic demonstrated the evolution of the role beyond their traditional purview. "This health crisis impacted the economy and the financial system, and it proved how all these areas are interconnected and intertwined,” she said. “So, there is a need to address environmental issues in a more holistic way for sound growth and to maintain financial stability as well.”
Rupert noted that, moving forward, financial institutions will start to report more broadly on nonfinancial factors that could pose financial risks down the road. “As a central bank, sometimes you need to look beyond the traditional risks, and you have to look a bit further in the future and a bit broader to see all the possible risks that are coming your way,” she said.
Leadership Lessons
As Gabreau pointed out, “One of the major lessons of this past year is in an ever-changing environment, central banks demonstrated resiliency, adaptability and flexibility, and that nothing is set in stone.”
D’Allegeershecque, Britain’s High Commissioner to Canada, certainly knows a thing or two about those qualities.
Over her 30-year diplomatic career, she has tackled issues such as Brexit and taken part in the negotiations that led to the Iran nuclear agreement. But she said leading staff through the pandemic was one of the biggest challenges of her career, and one that put her leadership skills to the test.
D’Allegeershecque said she’s learned that, in times of crisis, trust is the most critical trait for effective leadership. That trust must be reciprocal, but it’s not easily earned.
“That trust is not something that you can create overnight when the crisis hits you, so it's something that I have always tried to do in my jobs,” d’Allegeershecque said. "I’ve noticed that the leaders in my own organization who have been particularly effective are the ones who embrace that trusting form of leadership.”
D’Allegeershecque is well aware of the erosion of the public’s trust in various institutions, particularly government and the media. She was encouraged, however, by how the pandemic has restored some of that trust.
“I think what we have seen is that when people have trust in their governments, and when governments make decisions based on facts—not feelings, not emotions, not vote winning—our populations are incredibly well-disposed to do things which would have been unthinkable before this pandemic happened,” she said.
Part of that comes from clearly communicating why certain difficult decisions are being made. But d’Allegeershecque also emphasized that being a strong leader cannot come at the expense of empathy.
"Seeing glimpses of the struggles of some really senior people as they try and homeschool their kids has been a salutary for all of us, and it has shown that we're all facing the same challenges,” she said. “And I think it's no coincidence that many of the people who've done this best happen to be women. I don't think it's universally the case, but some of the leaders who have come out of this with their reputations and their popularity enhanced are the female leaders.”
Despite all the challenges of the previous year, d’Allegeershecque has worked with the Canadian government on the transition of a post-Brexit trade agreement with the U.K., as well as encouraging Canada to adopt ambitious climate change goals. For d’Allegeershecque—as well as the central bankers who have pressed forward with their climate change ambitions—resiliency is the key.
“I've dealt with lots of crises in my career,” she said. “Whether it's a coup, whether it's a kidnapping crisis, whether it's a political crisis—those things tend to be fairly short-lived. This has been very different, and every time we think that we are getting to a better place, there has been another set of challenges that have come to confront us. Some of those challenges have been expected and some of them have been completely unexpected. The importance of resilience in leadership cannot be overestimated.”
- Minute Read
- Listen Stop
- Text Bigger | Text Smaller
In the early days of the pandemic, central banks took swift action to help sustain their economies. That type of leadership helped stave off imminent economic panic, but central banks have also taken the lead on addressing the financial risks posed by nonfinancial issues, particularly climate change.
As part of the 16th Annual Women in FICC Industry Forum, we hosted a panel of three central bankers to get their thoughts on climate change and the insights they gained during the COVID-19 pandemic:
-
Nikki Rupert, sustainable finance officer at De Nederlandsche Bank, the central bank of the Netherlands.
-
Marie Gabreau, senior trader analyst secondment at the Bank of Canada / Banque de France.
-
Sabrina Wu, senior trader on the domestic trading desk for the Bank of Canada. Wu served as the moderator for the discussion.
We also discussed leadership in the wake of COVID-19 with Susan le Jeune d’Allegeershecque, who has been Britain’s High Commissioner to Canada since August 2017.
Following is a summary of those conversations.
Central Banks and Climate Change
It’s become clear that climate change presents risks on multiple fronts, including to global financial systems. Rupert explained that the 2015 Paris Agreement was the turning point for the Dutch central bank. Soon after, the bank concluded that climate change posed two challenges: the transition to an energy-efficient economy to help reverse the effects, and the physical risks associated with climate change—such as human displacement—which can also translate into financial risks.
Rupert said De Nederlandsche Bank’s first climate change report, published in 2017, wasn’t universally well received. “At the time some people thought we were crazy,” she said. “Why would a central bank look into these topics? But what we said in that report was that we see these climate-related risks that are relevant to the Dutch financial sector, and we expect Dutch financial institutions to analyze these risks, be aware of these risks and manage these risks if they are relevant for your institution.”
While some critics see the focus on climate change as being too politically charged, Banque de France’s Gabreau noted that the fact central banks had to respond to the pandemic demonstrated the evolution of the role beyond their traditional purview. "This health crisis impacted the economy and the financial system, and it proved how all these areas are interconnected and intertwined,” she said. “So, there is a need to address environmental issues in a more holistic way for sound growth and to maintain financial stability as well.”
Rupert noted that, moving forward, financial institutions will start to report more broadly on nonfinancial factors that could pose financial risks down the road. “As a central bank, sometimes you need to look beyond the traditional risks, and you have to look a bit further in the future and a bit broader to see all the possible risks that are coming your way,” she said.
Leadership Lessons
As Gabreau pointed out, “One of the major lessons of this past year is in an ever-changing environment, central banks demonstrated resiliency, adaptability and flexibility, and that nothing is set in stone.”
D’Allegeershecque, Britain’s High Commissioner to Canada, certainly knows a thing or two about those qualities.
Over her 30-year diplomatic career, she has tackled issues such as Brexit and taken part in the negotiations that led to the Iran nuclear agreement. But she said leading staff through the pandemic was one of the biggest challenges of her career, and one that put her leadership skills to the test.
D’Allegeershecque said she’s learned that, in times of crisis, trust is the most critical trait for effective leadership. That trust must be reciprocal, but it’s not easily earned.
“That trust is not something that you can create overnight when the crisis hits you, so it's something that I have always tried to do in my jobs,” d’Allegeershecque said. "I’ve noticed that the leaders in my own organization who have been particularly effective are the ones who embrace that trusting form of leadership.”
D’Allegeershecque is well aware of the erosion of the public’s trust in various institutions, particularly government and the media. She was encouraged, however, by how the pandemic has restored some of that trust.
“I think what we have seen is that when people have trust in their governments, and when governments make decisions based on facts—not feelings, not emotions, not vote winning—our populations are incredibly well-disposed to do things which would have been unthinkable before this pandemic happened,” she said.
Part of that comes from clearly communicating why certain difficult decisions are being made. But d’Allegeershecque also emphasized that being a strong leader cannot come at the expense of empathy.
"Seeing glimpses of the struggles of some really senior people as they try and homeschool their kids has been a salutary for all of us, and it has shown that we're all facing the same challenges,” she said. “And I think it's no coincidence that many of the people who've done this best happen to be women. I don't think it's universally the case, but some of the leaders who have come out of this with their reputations and their popularity enhanced are the female leaders.”
Despite all the challenges of the previous year, d’Allegeershecque has worked with the Canadian government on the transition of a post-Brexit trade agreement with the U.K., as well as encouraging Canada to adopt ambitious climate change goals. For d’Allegeershecque—as well as the central bankers who have pressed forward with their climate change ambitions—resiliency is the key.
“I've dealt with lots of crises in my career,” she said. “Whether it's a coup, whether it's a kidnapping crisis, whether it's a political crisis—those things tend to be fairly short-lived. This has been very different, and every time we think that we are getting to a better place, there has been another set of challenges that have come to confront us. Some of those challenges have been expected and some of them have been completely unexpected. The importance of resilience in leadership cannot be overestimated.”
Heard at our BMO Global Reserve and Asset Managers Conference
PART 1
Mapping an Equitable Recovery
Darryl White May 07, 2021
Economists are forecasting a powerful rebound as the world emerges from pandemic, in the same way business, nations and government came togeth…
PART 2
Talking Climate Change: Mark Carney in Conversation
Dan Barclay May 07, 2021
As the Governor of the Bank of Canada from 2008 to 2013, Ottawa-based economist Mark Carney successfully shepherded Canada through the Glob…
PART 4
Growing Appetite for Investing for Purpose with Fixed Income
Magali Gable June 02, 2021
As the world battles its way out of pandemic, the focus on sustainability is only intensifying, with investors, in particular the millennial cohort…
You might also be interested in
Why Sustainability Is Good Business: Key Takeaways from IEFA Toronto 2024
Building for Tomorrow: Real Estate, Construction, and Sustainability
A First in Western Canada: Avenue Living Leverages BMO's Retrofit Program to Add 179 New Rental Units in Downtown Edmonton
How NASA and IBM Are Using Geospatial Data and AI to Analyze Climate Risks
BMO Arranges Green Financing to Fund New Lawson Centre for Sustainability, Trinity College's Most Significant Build in a Century
BMO ranked one of the most sustainable companies in North America on the Dow Jones Sustainability Indices
Canada Has an Opportunity to Become a Global Leader in Carbon Dioxide Removal
More Companies Have Plans to Address Climate Change Based on Rising Business Importance: Survey Results
BMO Climate Institute Business Leaders Survey: Nearly Half of Business Leaders in the U.S. and Canada Believe Climate Change Has Already Affected Their Businesses, but Few Have a Strategy
How the Energy Sector Is Helping Canada Achieve Its Decarbonization Goals
Why Businesses Need to Accelerate Their Efforts to Fight Climate Change
Transforming the Global Food System to Benefit Investors and the Planet
Banco do Brasil and BMO Financial Group to Introduce First-of-its-Kind Program to Provide Sustainability-Linked Trade Loans Supporting Brazilian Exporters
BMO Donates $3 Million to GRID Alternatives to Provide Solar Energy Solutions for Low-Income Families
BMO Provides Innovative New Sustainability-Linked Deposit Product to Zurn Elkay Water Solutions
Quick Listen: Michael Torrance on Empowering Your Organization to Operationalize Sustainability
BMO and Bell Canada Execute Innovative Sustainability-Linked Derivative Tied to Ambitious GHG Emission Reduction Targets
BMO Named to UN-Convened Group Providing Guidance to Global Banks on Nature Target Setting
Driving Innovations In Tech To Strengthen Climate Resilience With Climate Engine’s Spatiafi, Built On Google Cloud
BMO Celebrates Earth Day with 3rd Annual Trees from Trades Day on its Global Trading Floors
BMO Donates $2 Million to the University of Saskatchewan to Accelerate Research Critical to the Future of Food
North America’s Critical Minerals Advantage: Deep Dive on Community Engagement
Exploring North America’s Critical Minerals Advantage: Global Metals, Mining & Critical Minerals Conference
The Most Valuable Commodity is Trust: ICMM to BMO Global Metals, Mining & Critical Minerals Conference
Rock Legends Reflect on Mining Hits and Misses: Global Metals, Mining & Critical Minerals Conference
BMO Experts at our 32nd Global Metals, Mining & Critical Minerals Conference
Evolving Mining for a Sustainable Energy Transition: ICMM CEO Rohitesh Dhawan in Conversation
Public Policy and the Energy Transition: Howard Learner in Conversation
Taskforce on Nature-Related Financial Disclosure (TNFD) – A Plan for Integrating Nature into Business
Takeaways from the BMO Climate Institute Small and Mid-Sized Businesses Climate Survey
BMO Ranked North America's Most Sustainable Bank by Corporate Knights for Fourth Consecutive Year
Is Green Financing for Nuclear the Next Frontier in the Energy Transition?
BMO ranked one of the most sustainable companies in North America on the Dow Jones Sustainability Indices
BMO Climate Institute Survey Shows Costs and Competing Priorities Slowing Climate Action for Small and Mid-Sized Businesses
Managing and Monetizing Your Transition to a Net Zero World with BMO and Radicle
BMO the Top Ranked Financial Institution on New Global Sustainability Benchmark Announced at COP 27
COP27 in Focus: Will Energy Security and Economic Uncertainty Impact the Climate Transition?
BMO to Invest in Innovative Carbon Offsets from CarbonCure to Permanently Store CO2
RoadMap Project: An Indigenous-led Paradigm Shift for Economic Reconciliation
A Canadian First: BMO and Concordia University Partner for a Sustainable Future with Innovative Sustainability-Linked Loan
Sustainability Strategy and Reporting for Small and Medium Sized Companies: A Discussion at the Conference of Montreal
Op Ed: Businesses and Community Organizations Need to Come Together to Fight Poverty
BMO to Acquire Calgary-based Radicle Group Inc., a Leader in Environmental Services
Investment Opportunities for a Net-Zero Economy: A Conversation at the Milken Institute Global Conference
How Hope, Grit, and a Hospital Network Saved Maverix Private Capital Founder John Ruffolo
Hydrogen’s Role in the Energy Transition: Matt Fairley in Conversation
Exploring the Physical and Transition Risks Facing Food and Agriculture
Key Takeaways on Ag, Food, Fertilizer & ESG from BMO’s Farm to Market Conference
Building an ESG Business Case in the Food Sector: The Food Institute
Forging Ahead in the Energy Transition: Darryl White to Global Reserve and Asset Managers
BMO and EDC Announce Collaboration to Introduce Sustainable Finance Solutions for Canadian Businesses
Retrofitting Canada's Building Sector: Efficiency Canada’s Corey Diamond in Conversation
The Role of Hydrogen in the Energy Transition: FuelCell Energy CEO Jason Few in Conversation
BMO proud to support first Government of Canada Green Bond transaction as joint-lead manager
Op Ed: Government Action Can Help Spur More Home Building To Address Canada’s Housing Shortage
Tackling Climate Change in Metals and Mining: ICMM CEO Rohitesh Dhawan in Conversation
BMO Launches Business Within Reach: BMO for Black Entrepreneurs and Commits $100 million in loans to Help Black-led Businesses Start up, Scale up, and Grow
The Post 2020 Biodiversity Framework – A Discussion with Basile Van Havre
BMO Announces Plan to Partner with Breakthrough Energy Catalyst to Accelerate Climate Innovation
BMO Financial Group Named North America's Most Sustainable Bank for Third Consecutive Year
Mitigating the Physical Impacts of Climate Change with Spatial Finance
BMO Helps Boralex Go Beyond Renewable Energy, with the Transition of its Credit Facility to a Sustainability-Linked Loan
A Global First: BMO Supports Bruce Power with World's First Nuclear Green Financing Framework
BMO ranked one of the most sustainable companies in the world according to Dow Jones Sustainability Indices
The Future of Remote Work and Diversity in the Asset Management Industry
North American Metals & Mining first: BMO helps Sandstorm Gold Royalties achieve ESG goals with Sustainability-Linked Loan
Education, Employment and Economic Empowerment: BMO Releases Wîcihitowin ᐑᒋᐦᐃᑐᐏᐣ- First Annual Indigenous Partnerships and Progress Report
BMO Announces $12 Billion Financing Commitment towards Affordable Housing in Canada
BMO supports Canada's bid to host the headquarters of the International Sustainability Standards Board
In support of Canada’s bid to host the headquarters of the International Sustainability Standards Board
BMO Named to Canada's Best 50 Corporate Citizens Ranking by Corporate Knights
Biggest Trends in Food and Ag, From ESG to Inflation to the Supply Chain
Cloud, Data and Zero-trust: Here’s Where VCs are Putting Their Cybersecurity Investments
BMO Announces $250,000 Donation to Organizations Supporting Global Emergency COVID-19 Relief Efforts
A North American First: BMO Helps Gibson Energy Fully Transition Credit Facility to a Sustainability-Linked Loan
Understanding Biodiversity Management: Best Practices and Innovation
Canada Eyes Biggest Economic Rebound in Half a Century, Plots Equitable Recovery - Panel
Leading with Resiliency: Highlights from BMO’s Forum for Executive Women
Ian Bremmer in Conversation: The Pandemic and a Changing Geopolitical Landscape
Episode 29: What 20 Years of ESG Engagement Can Teach Us About the Future
BMO Financial Group 2020 Sustainability Report and Public Accountability Statement Now Available Online
Episode 28: Bloomberg: Enhancing ESG Disclosure through Data-Driven Solutions
BMO Ranked Among Most Sustainable Companies on Dow Jones Sustainability Index - North America
BMO investing in a sustainable future with $1M donation to the Institute for Sustainable Finance
BMO Financial Group Reaches Key Milestone in Matching 100 Per Cent of Electricity Usage with Renewables
BMO Financial Group Recognized as One of the World's Most Sustainably Managed Companies in New Wall Street Journal Ranking
Episode 23: TC Transcontinental – A Market Leader in Sustainable Packaging
BMO Financial Group to Source 100 Per Cent of Electricity Usage From Renewables
COVID-19 Puts Spotlight on Strong Liquidity Management, Antifraud Practices
Canada's Six Biggest Banks Take Decisive Action To Help Customers Impacted by COVID-19
Episode 07: World Bank: Mobilizing Capital Markets for Sustainable Finance
Episode 06: Responsible Investing – Industry Trends and Best Practices from Canada