The European Central Bank drew backlash earlier this year for its decision to levy big fines on banks missing key climate targets. Now, it’s upping the ante.
In a speech Friday, Frank Elderson, the ECB’s climate chief, said a second set of banks would accrue daily penalties that could run up to millions of euros for each day they fail to meet deadlines imposed earlier this year.
“Weaknesses in banks’ practices remain and have been communicated,” Elderson said in a speech in Amsterdam. “In a small group of outliers, foundational elements for the adequate management of climate and nature-related risks are still missing.”
“Banks need to ensure that their risk management practices are and continue to be commensurate with the magnitude of the climate and nature-related risks that they face,” he added.