The structure of our financial sector is fundamentally misaligned with the challenges and risks posed by climate change, and the Bank of England knows it.

In an unprecedented move by one of the world’s leading central banks, by next year the Bank of England could include the impact of climate change as part of its annual stress tests of the banking system.

If climate change is deemed to pose a systemic risk to our banking and financial system, banks could eventually be penalised for lending against carbon intensive activities, like fossil fuel extraction.

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