The Bank of England will look at introducing climate change considerations when deciding which corporate bonds it buys, governor Andrew Bailey said today.
The central bank had been targeted by climate change protesters who have been calling and emailing it this week to demand a change in the way it helps companies survive the Covid-19 economic crisis.
“When the pressure on our resources abates, we will turn to important issues such as the benchmark for our corporate bond portfolio,” Bailey said in a statement on Wednesday.
The BoE has a £20bn corporate debt purchase target as part of its expanded bond-buying program to help shield Britain’s economy.
In March, shortly before the coronavirus pandemic escalated, he said there was a strong argument for changing the way the central bank bought corporate bonds based on climate concerns.
Bailey said the crisis had not changed the BoE’s commitment to combating climate change, but said the pandemic “has required hard decisions to be taken on competing priorities”.
A lending program for companies run by the BoE — which is separate to its corporate bond-buying — did not incorporate a test based on climate considerations.
“This was deliberate, because in such a grave emergency affecting this country we have focused on the immediate priority of supporting the jobs and livelihoods of the people of this country,” Bailey said.
The Bank has so far lent nearly 20 billion pounds to firms under its Covid Corporate Financing Facility.
“We believe that the Bank’s duty to the people of this country requires such a difficult choice to be made, but it will not change our commitment to the goals of countering climate change,” Bailey said.