instruments. in combination these measures have enabled central banks to create accommodative financial conditions, greatly enhancing the transmission of monetary policy. however, in the world of rapid transformation, it seems sensible to think that central banks should evaluate their monetary policy frameworks time to time. regular review would also make the strategy more open and transparent. it is also important that the central bank does not act in a way that does not reflect announced long - term policy goals. 5 / 6 bis central bankers'speeches many central banks already have an evaluation process in place. the bank of canada is one example of such practice. the federal reserve system also has a procedure in place for strategy review. the same is true for the bank of england and the swedish riksbank. the evaluations could be internal or made partly by outside evaluators. the background papers supporting evaluation could be made public. the ecb would benefit from considering its strategy work in this perspective. regular reviews would assist the ecb to stay in tune with the rapidly changing economic and financial environment. especially in our present times of uncertainty, it is essential for any central banker to possess a fully modernized monetary policy toolbox that is as functional and as effective as possible. that would help “ the fox ” to outsmart the opposing forces and overcome the immediate obstacles, and enable “ the hedgehog ” to stay the course of medium - term price stability, sustained growth and high employment. so why not pursue it? many thanks for your attention, and welcome to the seminar. 1 michaela schmoller, secular stagnation : a false alarm in the euro area? bank of finland bulletin 4 / 2018. 2 brainard, william, uncertainty and the effectiveness of policy. american economic review, 57 ( may ), 411 – 25. 3 peter praet, economic policymaking under uncertainty. speech at the caixa, madrid, 17 october 2018. 4 e. g. a broad study by banco de espana concluded that in the united states, the range is from – 3 %. to 5 %. similarly, holston, laubach and williams, leading names in this area of research, estimate that the confidence band around their estimates of the natural rate for the u. s. is currently around 5 percentage points. 5 for further discussion on the state of the phillips curve, slack in the economy and inflation expectations, see e. g. www. bofbulletin. fi / en / 2018 / 1

as environmental tax reforms. likewise, a number of central banks and supervisors have joined their hands in the network for greening the financial system. in the eu, and also globally, the financial sector still lacks adequate instruments for mainstreaming green finance. the eu commission, through its plans for a capital markets union and sustainable finance action is working on this. climate - related criteria should be better reflected in the key tools used for decision - making by market actors, such as benchmarks and credit ratings. apart from the simple carbon footprint, we also need to look beyond that. in addition to the production and life - cycle of things, it is becoming more important to consider what happens to products in their afterlife. many things considered green are not that, if we do not reuse and recycle the resources. electric cars is one of the prime examples. similarly, many things considered brown might be less so, if 1 / 2 bis central bankers'speeches the product lifetimes are long enough and resources can be recycled in afterlife. looking at what the financial sector can do for the circular economy, in my view the financial industry does acknowledge the problem, and there are ample amounts of capital looking for sustainable companies. more work needs to be done on how companies can cost - effectively and reliably indicate the sustainability of their operation. but for all companies planning their future, now it ’ s the time to think deep about how to transform their business models sustainable, and turn that into concrete actions. not least because there is a paradigm shift going on in the sentiment of the investor base, and it is starting to affect the selection of companies that attract investments and funding in the future. i know this first - hand, because this is what we do in the investment policy of the bank of finland. ladies and gentlemen, let me conclude. as i said, environment - and climate - conscious business models are becoming increasingly mainstream. that is fine, but the transition should be much speedier. hence, i want to encourage us all to recognize the urgency of concrete climate action, and build a timely and consistent transition path to the sustainable circular economy. 2 / 2 bis central bankers'speeches