##g ’ s real estate management and decisions relating to large real estate investments. the gpfg is a long - term and responsible owner. our work on responsible investment is an integral part of the investment process. as of this year, the council on ethics issues recommendations on company exclusion directly to norges bank. norges bank ’ s executive board will on the basis of these recommendations assess exclusion against other tools in the exercise of ownership. the aim is to establish a unified chain of tools. climate change has been among the focus areas of management since 2006. our work on financial risk as a result of climate change is incorporated in the investment strategy and the financial objectives of the gpfg. the ministry of finance is now working to introduce a new behavioural criterion for companies ’ climate emissions in the guidelines for observation and exclusion. such a criterion must then be managed in line with the highest defined threshold for exclusion. bis central bankers ’ speeches it is important that the overriding principle for norges bank ’ s investment management continues to be that the gpfg is a responsible investor with a financial objective. if the gpfg is increasingly used as an instrument for pursuing objectives other than financial ones, it may reduce the clarity of the gpfg ’ s role as a financial investor. if the gpfg investment scope is subject to considerable restrictions, it may entail increased risk or lower returns. the management of the gpfg has been successful to date. the total return since the establishment of the gpfg amounts to more than nok 2 500 billion, or about 40 percent of gpfg capital. through its management, norges bank will continue to promote its overriding objective : to safeguard the fund ’ s assets over time. thank you for your attention. bis central bankers ’ speeches

nor have the side effects of our novel measures been as drastic as the public debate at times suggests. for example, there is no evidence that purchases of government debt have undermined the disciplinary function of financial markets or created moral hazard. 3 lower interest rates did not lead governments to take on more debt. the primary balances for the vast majority of euro area countries improved after the start of our government bond purchases. moreover, the sensitivities of euro area sovereign bond yields to macroeconomic news and risk remain far removed from the complacency that characterised financial markets in the run - up to the global financial crisis. but the risk that non - standard policy tools may eventually create unintended adverse side effects becomes higher, the more intensively they are used and the longer they are maintained. this is where the title of this morning ’ s session comes in again : the lower nominal interest rates are, the larger are the benefits of using other policy domains more actively, in particular fiscal and structural policies. the current pandemic crisis is a case in point. the measures we have taken since march – most notably the asset purchases under the pandemic emergency purchase programme, or pepp, and the liquidity provision to banks through targeted longer - term refinancing operations, or tltros, – have been crucial in allowing the financial sector to act as a backstop for the euro area economy. 4 2 / 4 bis central bankers'speeches they prevented the health crisis from turning into a full - blown financial crisis at a time when markets started to panic and price action became highly destabilising, which could have had dire consequences for society as a whole. but at times of significant uncertainty, private investment may not fill the gap left by the pandemic in spite of very favourable financing conditions. in these situations, monetary policy cannot unfold its full potential. fiscal expansion is then indispensable in order to sustain demand and mitigate the long - term costs of the crisis. 5 strong complementarities reinforce the policy impact, working in both directions. on the one hand, fiscal policy will be more effective when interest rates can be expected to remain low for a considerable period of time, like today. on the other hand, decisive fiscal action increases the effectiveness of monetary policy, especially in the presence of divergent developments across the euro area. indeed, the historic decision by european governments to tackle this crisis with a common fiscal response was not only a strong gesture of