Central banks stepped into the breach to stabilise banks and restore growth after the global financial crisis — now, green campaigners would like them to take on the yet bigger challenge of making sure the financial system penalises carbon-intensive assets and funds the transition to clean energy. Only recently have central banks seen any role in managing the systemic risks of climate change — the effects of which will largely be felt well beyond the horizon of regulators and rate-setters. In 2015, Mark Carney , Bank of England governor, was widely accused of overstepping his remit when he urged action on what he called a “ tragedy of the horizon ”, arguing that “once climate change becomes a clear and present danger to financial stability, it may already be too late”. Now, most accept in principle that climate change threatens financial stability. More frequent extremes of weather will damage […]