The European Central Bank and the Future of Ethical Debt Market

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When assuming the position of President of the European Central Bank (ECB), Christine Lagarde decided to perform a strategic review of monetary policy as one of the first objectives of her term. The review aimed to take account on the ECB’s agenda of the social and climate challenges faced by European society. According to Lagarde, the ECB should join forces with European institutions to counteract the threats of the 21st century, such as climate change and social inequality. This is because financial markets bear joint responsibility for building a sustainable development economy that reconciles economic interests with social responsibility.

Social responsibility is something relatively new when speaking of financial markets. Markets have always been a place for raising capital and maximising profits at some acceptable level of risk. The realisation that there is an ethical dimension to the activities of market actors, where acting for the higher and general good may conflict with financial self-interest, testifies to significant qualitative changes in the world of finance. These changes are all the more meaningful because ethical reflection on the activities of market actors is not only stimulated by mounting social pressure for qualitative changes, but also because the actors themselves are increasingly aware of the need to encourage financial institutions to engage in global efforts to promote sustainable development.

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