Urszula Szczerbowicz is an Associate Professor of Economics at SKEMA Business School. She is a researcher at the SKEMA Centre for Global Risks. Her research focuses on issues in Monetary, International and Financial Economics. She is currently investigating the evolving role of central banks in addressing climate change.
Could you tell us more about your field of research, particularly how central banks’ climate-related communications affect financial markets and asset prices?
My research focuses on how monetary policy shapes financial and economic conditions. Particularly how central banks adapt to new challenges, such as global financial crises and more recently climate change, and how these policy changes impact the real economy.
With colleagues at the Banque de France, we developed a Central Bank Climate Action Communication Index to quantify the European Central Bank’s (ECB) communications on climate-related policy decisions. Our index helps evaluate how these communications impact financial markets and private sector portfolio decisions.
What results surprised you the most?
We found that the ECB’s communication about its climate action significantly impacts asset prices. When this communication intensifies, the value of “brown” assets (e.g. fossil fuels) decreases compared to “green” assets (e.g. renewable energy). While this was expected, we were surprised by who sells and who buys: households and banks sell their brown assets, whereas some investment funds without environmental, social, and governance criteria buy them, possibly to take advantage of the price difference.
What are the foreseen outcomes?
Our index aims to enhance transparency by measuring the ECB’s commitment to climate action. It guides sustainable investment, and helps investors manage climate-related financial risks. Our research also informs policymakers on how central bank communication can influence financial markets, and underscores the role of central banks in the climate transition.