Author: Olga Mikheeva (Copenhagen Business School)

Abstract: Institutions of financial governance, particularly Central Banks and Finance Ministries, have rised in importance based on the roles and policy functions they have assumed in climate and decarbonisation policies. The transnational nature of climate change, coupled with the transnational networks that govern financial flows, have led financial governance agencies to form global coalitions and advocacy groups that act as important standard- and norm-setters in the domain of climate action. Some of these networks and coalitions also develop substantial technical expertise, which makes them active in international policy advocacy and capacity building programmes that target developing countries.

The EU has positioned itself as the climate action champion while actively engaging in climate diplomacy worldwide. To navigate the complexity of transnational networks and coalitions that surround the domain of climate action at the intersection of financial governance, the EU has been active in establishing its own coalitions while simultaneously developing institutional links with global networks, both through the supranational institutions and through individual Member States. If considered from the NAVIGATOR’s methodology point of view, EU establishing own networks as a way to navigate the fragemented transnational climate governance can be a way to optimise ‘search costs’ by focusing and promoting already existing competences and policy toolbox, such as the EU Sustainable Finance framework.

This working paper focuses on the interaction between transnational networks, EU-led initiatives, and the climate policy tools promoted by financial governance agencies (eg Finance Ministries) of individual Member States. In empirical terms, it illustrates these interactions through the case of the EU-founded International Platform for Sustainable Finance, the Global Coalition of Finance Ministers for Climate Action, and two concrete policy tools promoted by two Member States of the EU – Sweden and Denmark – through the Global Coalition’s work, such as effective use of the carbon tax (Sweden) and ‘green’ econometric modelling (Denmark). Both policy tools have been developed and housed in respective Finance Ministries. In conceptual terms, the paper suggests that the boundaries of climate policy have expanded towards the macroeconomic policy domain, which further suggests the relevance of problematising the roles and policy functions of financial bureaucracies in climate action.

Keywords: climate change, governance, financial bureaucracies, the EU, Member States, Global Coalition of Finance Ministers for Climate Action

Citation Recommendation: Mikheeva, Olga (2026). “Climate Change and Finance: A Financial Bureaucracies’ Perspective”. NAVIGATOR working paper, WP. 5, D. 2. (February), pp. 1-20. https://eunav.eu/