What biodiversity and nature loss mean for our economy

Nature is in danger. This affects us all, including businesses and banks. Why is this relevant for the ECB’s mandate? Join our host Stefania Secola and her guest Frank Elderson, Executive Board member and Supervisory Board Vice-Chair, as they discuss nature loss, its impact on our economy and what we’re doing about it. The views expressed are those of the speakers and not necessarily those of the European Central Bank. Published on 25 November 2023 and recorded on 17 November 2023. In this episode: 00:05 – Nature is in danger Habitats and species are in decline. How does this affect our economies? And if our mandate is to maintain price stability and keep euro area banks safe and sound, why does the ECB care about biodiversity loss? 02:01 – The economic impact of biodiversity loss How big is the impact of biodiversity loss on people and businesses? How much are banks, and the wider economy, affected? And what’s the ECB’s role in this? 08:38 – What’s the ECB doing about nature loss? Knowledge is the first step. Quantifying the impact that nature loss has on our economies and banks is important. But what can the ECB do with these findings? 15:51 – Are banks doing enough? We’ve asked banks to come up with action plans to assess their climate and environmental risks. But they need to make more progress. 17:45 – Our guest’s hot tip Executive Board member and Supervisory Board Vice-Chair, Frank Elderson, shares his hot tip with our listeners. Additional material: Occasional Paper: Living in a world of disappearing nature: physical risk and the implications for financial stability https://www.ecb.europa.eu/pub/pdf/scpops/ecb.op333~1b97e436be.en.pdf?90e7aaae4ef927f887a787587a22adba The ECB Blog by Frank Elderson: The economy and banks need nature to survive https://www.ecb.europa.eu/press/blog/date/2023/html/ecb.blog230608~5cffb7c349.en.html The ECB Podcast: Are banks walking the talk on climate? https://www.ecb.europa.eu/press/tvservices/podcast/html/ecb.pod221102_episode44.en.html The ECB Podcast: Being transparent about climate risks https://www.ecb.europa.eu/press/tvservices/podcast/html/ecb.pod230513_episode58.en.html “Addressing tipping points for a precarious future” by Timothy O’Riordan and Timothy Lenton European Central Bank http://www.ecb.europa.eu/