rey2_krisanapong detraphiphatGetty Images_financeclimatechange krisanapong detraphiphat/Getty Images

Observing the Green Swans

The risks associated with climate change, biodiversity loss, and our responses to those problems are poorly understood, because there are no historical comparisons. But with the right tools, central banks and other macro-prudential authorities can stay ahead of the curve.

LONDON – The statistician Nassim Nicholas Taleb coined the term “black swan” to describe improbable, hard-to-predict events that can have a massive impact on the economy. The authors of a recent report have now introduced into the taxonomy of finance the phrase “green swans”: events caused by climate change and biodiversity loss.