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The Federal Reserve announced Friday that it has withdrawn from the global climate change regulatory group, citing actions that exceeded the Fed’s legal authority.
The Federal Reserve has withdrawn from the Network of Central Banks and Supervisors for Greening the Financial System (NGFS), which was established in 2017 to promote green finance and climate change policies. The group develops policy recommendations to help central banks and financial regulators play a role in the fight against climate change by incorporating climate risks into their oversight practices.
In 2020, the Federal Reserve System joined the NGFS as a permanent member, and the organization now includes more than 100 central banks and financial regulators as members.
“While the Board has appreciated the engagement of the NGFS with its members, the scope of NGFS’ activities is increasingly broadening to cover a broader range of issues that are outside the scope of the Board’s statutory authority.” said in a statement.
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The Federal Reserve announced its withdrawal from the Network of Central Banks and Supervisors for Greening the Financial System, citing the group’s increasingly broad regulatory focus. (license/image)
The Fed has taken steps in recent years to incorporate climate change into its operations using preliminary analyzes and reports.
But Fed Chairman Jerome Powell has repeatedly argued that the Fed is not responsible for setting climate change policy and that these issues fall within the purview of Congress.
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Federal Reserve Chairman Jerome Powell said Congress, not the Fed, is responsible for climate change rules. (Alex Wong/Getty Images/Getty Images)
The Fed’s announcement came ahead of the inauguration of President-elect Trump’s second term in the White House, which begins on Monday.
President Trump has criticized the government’s efforts to advance climate change policies.
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Reuters contributed to this report.
