From climate and nature risks to economic resilience and competitiveness

Frank Elderson, Member of the Executive Board of the European Central Bank (ECB) and Vice-Chair of the Supervisory Board, delivered a keynote speech at the Green Swan 2026 Conference.

He highlighted the increasing impact of climate change and nature degradation on economies, citing the summer of 2026 as the warmest recorded in Western Europe, with severe droughts, wildfires, water scarcity, and ecosystem pressures.

Elderson emphasized that climate and nature risks are embedded within economic systems and are becoming macroeconomic concerns. He discussed how individual shocks can accumulate and reinforce each other, affecting productivity, inflation, and financial stability.

The speech outlined the importance of both adaptation and mitigation strategies. Adaptation involves infrastructure and resilience measures, while mitigation addresses the root causes of climate change. A combination of both is necessary to maintain economic resilience and competitiveness.

The transition to green energy is presented as a strategic opportunity for resilience and long-term growth. Reducing dependence on fossil fuels through renewable energy and electrification can enhance energy security and reduce vulnerability to geopolitical shocks.

Barriers to progress include uncertainty and access to finance. Policy stability and predictability are crucial for long-term investments. The scale of required investments in Europe alone is hundreds of billions of euros annually, necessitating international cooperation and a level playing field.

In conclusion, Elderson stressed that proactive, comprehensive responses combining adaptation, mitigation, investment, and international cooperation are essential. Properly managed, the transition offers opportunities for a more resilient, productive, and prosperous economy.