Monetary Policy and Financial Initiatives in the EU for Climate Change. How Coordinated Are Both?

The transition towards a sustainable economy requires a shift in the behaviour of the agents involved: producers, consumers, investors and public entities. While various traditional policy instruments can promote this shift (regulation, taxation, fiscality, R&D), the academic literature is gaining momentum around the need to broaden the focus and incorporate macroeconomic financial and monetary policies to promote a transition towards a more sustainable economy, this paper is based on an analysis of the financial and monetary policies developed by the EU to address climate change. To this end, the objectives pursued by each of these policies are analyzed and the relationship between them is established, thereby assessing the degree of commitment and coordination between them. A preliminary look at the results reveals two main conclusions: first, a paralysis in the financial initiatives and measures taken by the ECB; and second, an imbalance and lack of coordination between the financial challenges and needs and the monetary policies necessary to implement them.