Activists call on Swiss central bank to pay more attention to the environment

Despite its stated commitment to following strict investment rules, critics of the Swiss central bank say it still invests in companies that harm the environment. As a passive investor, the bank is said to be complicit in the degradation of ecosystems that are critical to the planet’s balance. Officials, however, argue that the bank has no mandate to address climate change or biodiversity risks.

Environmentalists protested at the Swiss National Bank’s annual shareholders’ meeting in Bern, urging the central bank to divest from companies they say contribute to environmental devastation in areas such as the Amazon rainforest and the Cerrado savannas. Reuters reports.

The protesters object to the bank’s stakes in companies identified in a University College London study as having activities that, they say, cause irreversible environmental damage. They are calling for stricter investment exclusion criteria and for the central bank to use its position as a shareholder to influence companies’ behaviour.

In response, Swiss National Bank Chairman Martin Schlegel said the institution follows strict exclusion principles in its investments and avoids companies that violate human rights or cause serious environmental damage.

He also noted that the central bank has no mandate to address climate change or biodiversity risks.

“The Swiss National Bank does not set climate targets for its monetary reserves. This is because of our clearly defined and narrow legal mandate, which focuses on price stability,” Schlegel said, adding that an expanded role could threaten the bank’s independence.

Asti Roesle of the climate campaign Climate Alliance Switzerland, who spoke at the meeting, said the central bank could have a significant influence because of its substantial equity investments—it holds approximately 25 % of its foreign exchange reserves of 756 billion Swiss francs (914 billion USD) in global equities.

“If the Swiss National Bank ignores climate and environmental risks in its monetary decisions, it is acting shortsightedly and neglecting its duty to protect future generations,” she said.

She also pointed to the already visible effects of climate change in Switzerland, including melting glaciers and extreme weather that has caused landslides and economic damage.