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Our approach to our climate objectives

To fulfil our climate objectives and make sure that our decisions are targeted and effective, we first need solid analysis regarding the impact of climate change. This goal requires both sound data and modelling methods.

Climate-related risks are particularly difficult to measure and model because they emerge over the long term and are non-linear, global and highly uncertain. Nonetheless, the science tells us that action is required now.

How is the ECB addressing this challenge?

We use a three-pronged approach to reach our climate objectives, helping us to take immediate action while offering space for improvements in our knowledge and the subsequent adjustment of policies.

We IMPROVE climate-related data

We compile data ourselves and contribute our expertise to international efforts to improve the quality and quantity of climate-related data whenever we can.

Our own climate-related disclosures, as well as future collateral disclosure requirements relating to the upcoming implementation of the Corporate Sustainability Reporting Directive (CSRD), also contribute to this goal.

We ENHANCE our analyses

As climate-related data improves, we work to enhance our macroeconomic models, scenario analyses and risk assessment. This helps us better account for climate risks, as well as the opportunities that the transition to a carbon-neutral economy may bring.

As our understanding increases, we can ultimately make more informed policy decisions.

We ADJUST our policies

Based on our analyses, we take action in areas where we see fit. These areas include corporate bonds, our own investments, and our own environmental footprint.

As climate-related data and modelling improve, we will adjust our policies accordingly. This means that our climate strategy will evolve and improve over time.

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