On Thursday 23 March, the European Central Bank (ECB) published information for the first time on the carbon footprint of the private and public securities portfolios it holds for monetary policy purposes and via its staff pension fund. It intends to repeat this exercise each year.
The two reports “give us a clear view of our progress in decarbonising our portfolios and, over time, they will help us to chart the most effective course towards the goals of the Paris Agreement”, Lagarde said in a statement.
According to the monetary institute, data on private company securities held under the CSPP and PEPP programmes show that the companies in question are gradually reducing their carbon footprint as well as the fact that the ECB, since October 2022 (see EUROPE 13024/11), has been shifting its portfolio towards companies with lower CO2 emissions.
In the fourth quarter of 2022, the average carbon footprint of the monetary institute’s reinvestments of maturing securities fell by 65% compared to the first three quarters of the same year. However, the ECB acknowledges that, given the existing stock of securities portfolios acquired under the CSPP and PEPP programmes, “it would take some time for the tilting to have a substantial impact on the overall carbon metrics”.
See the report on the carbon footprint of the CSPP and PEPP programmes: https://aeur.eu/f/5zc
Regarding investments made for purposes other than monetary policy, the second report shows that the ECB has reduced the carbon footprint of its staff pension fund by “more than half since 2019”. As for its own funds, the ECB has gradually increased the share of green bonds “from 1% in 2019 to 13% in 2022”.
“As this portfolio consists mainly of euro area government bonds, its decarbonisation depends to a large extent on countries’ efforts to reduce their emissions”, the EU institution noted.
See the report on the carbon footprint of the ECB’s non-monetary policy portfolios: https://aeur.eu/f/5zd (Original version in French by Mathieu Bion)