Frank Elderson: Taking action for nature – investing in economic resilience and prosperity

Frank Elderson, Member of the Executive Board and Vice-Chair of the Supervisory Board of the ECB, argues at COP17 that protecting and restoring nature is an investment in economic resilience, not spending. He stresses that ecosystem degradation is already hitting firms, bank balance sheets and prices, and therefore the ECB's mandate.

Key points

• 72% of euro area firms depend on at least one ecosystem service, and 75% of corporate lending goes to highly dependent companies
• A 1-in-100-year drought could put up to 24% of euro area output at risk
• The ECB expects banks to manage nature-related risks alongside climate risks
• Food price increases after heatwaves and droughts are an upside risk to inflation

Who is affected

Supervised banks, firms and monetary policy

Plain-language version

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