Network for Greening the Financial System (NGFS)

Subject: International Relations

Section: International organization

Concept:

The Network for Greening the Financial System (NGFS)is a network of 114 central banks and financial supervisors that aims to accelerate the scaling up of green finance and develop recommendations for central banks’ role for climate change.
The NGFS was announced at the Paris “One Planet Summit” in December 2017 and its secretariat is hosted by the Banque de France.
The network was launched by 8 founding central banks, under the leadership of Banque de France’s governor François Villeroy de Galhau, the Dutch Central Bank’s Frank Elderson and the Bank of England’s former governor Mark Carney. Hong Kong Monetary Authority is one of the founding member
Reserve bank of India became a member in 2021.
Notable observers: Asian development bank, Bank for International Settlement, Basel Committee on Banking Supervision, European Bank for Reconstruction and Development, International Organization of Securities Commission (IOSCO), IDB (Inter-American Development Bank), International Association of Insurance Supervisors, International Monetary Fund, Organisation for Economic Cooperation and Development (OECD), Sustainable Insurance
Its current chair is Ravi Menon, Managing Director of the Monetary Authority of Singapore

Initiatives:

The purpose of the NGFS is “to define, promote and contribute to the development of best practices to be implemented within and outside of the Membership of the NGFS and to conduct or commission analytical work on green finance.”
The NGFS organises events and research on climate change. In 2021, the NGFS identified 9 policy options that could.be chosen by central banks to align their monetary policy with climate objectives
The NGFS work is currently organised around 5 work streams: Micro prudential/Supervision, Macro financial, Scaling up green finance, Bridging the data gaps, Research.