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Media reaction: 8 July 2021
The European Central Bank announced new measures today to green its monetary policy framework.
Reacting to the announcement, ClientEarth lawyer Jamie Sawyer said: “The ECB has finally accepted the need to integrate climate change into its operations – a welcome and positive step.
“But the measures so far proposed still fall way short of what’s needed for the ECB to fulfil its mandate and legal obligations on climate. The bank is stalling on making real progress by prioritising analysis over immediate action to cease buying assets from big polluters.
“What’s clearly missing is urgency. Under the planned timeline, the reforms will fail to address the climate impact of the ECB’s bond purchases and meaningfully reduce the carbon footprint of its bond portfolio for several years – years we simply do not have.
“The ECB has avoided the concrete steps that can and must be taken to immediately exclude bonds issued by companies whose activities are clearly incompatible with a low-carbon future, such as coal and unconventional oil and gas.
“The ECB has positively indicated it will redesign the corporate bond purchase framework, but the proof will be in its implementation. The central bank will continue to undermine EU climate goals if it fails to raise its ambition and fully align the programme with the Paris Agreement with urgency.”
In April this year, ClientEarth launched legal action against the Belgian National Bank over its implementation of the ECB’s Corporate Sector Purchase Programme. The action argued that asset purchases carried out under the programme were in breach of the central bank’s legal obligations related to climate and environmental protection requirements.
The lawsuit asked for a question to be referred to the European Court of Justice which would decide whether the programme is valid or invalid. The next hearing in the proceedings is scheduled for November this year.
ClientEarth is a non-profit organisation that uses the law to create systemic change that protects the Earth for – and with – its inhabitants. We are tackling climate change, protecting nature and stopping pollution, with partners and citizens around the globe. We hold industry and governments to account, and defend everyone’s right to a healthy world. From our offices in Europe, Asia and the USA we shape, implement and enforce the law, to build a future for our planet in which people and nature can thrive together.