stem from global warming are referred to as physical risks. in a recent survey by the european investment bank, 58 % of eu firms reported that their business is already being affected by physical risks. there is another category of risk associated with climate change – these are called transition risks. these can occur as our economies move towards net zero. carbon - intensive industries in particular may face the risk of their assets becoming stranded. to reduce these risks, the eu is committed to reaching net zero emissions by 2050. to achieve this target, climate policies will be put in place that will inevitably trigger substantial changes to existing business models – across all industries. firms must prepare and adapt their business models. the aviation industry is no exception here, as extreme weather events can affect its business operations. but aviation itself also has an impact on the climate. carbon emissions from fossil fuels are a major driver of global warming. the aviation industry ’ s contribution to global co2 emissions is around 2. 5 %. [ 3 ] moreover, emissions from flying have risen by more than 2 % per year over the last two decades. so it ’ s high time for the aviation industry to step up its climate action. but some action is already underway. the international air transport association has committed to achieving net zero carbon emissions by 2050. [ 5 ] the international civil aviation organisation ’ s carbon offsetting and reduction scheme, corsia, is an important step towards reaching this goal. in addition, technological improvements and the usage use of sustainable aviation fuels will play a central role. sustainable aviation fuels are available today but demand is far outstripping supply. it is important to scale up sustainable aviation fuels. this requires a favourable policy environment with a mix of smart regulation and incentives. one year ago, the european commission adopted the ‘ fit for 55 ’ package to underpin the eu climate targets. this package includes the refueleu proposal, which aims to boost the production and uptake of sustainable aviation fuels. the proposal puts forward obligations for fuel suppliers to gradually increase the share of sustainable aviation fuels in fuels blends. this share should rise from 2 % in 2025 to 63 % by 2050. [ 6 ] the european parliament is even pushing for a share of 85 % by 2050. [ 7 ] in any case, by mandating the uptake of sustainable aviation fuels, the eu is creating a platform for long - term planning and setting incentives to boost sustainable aviation fuel production. this is a good example of how smart

low carbon economy. more and more investors are going to assess whether companies ’ net zero commitments square up with their actions. 5 central banks as catalysts for greening the financial system allow me to circle back to my initial question : why am i – a central bank official – telling you all this? because central banks play an important role in tackling climate change and boosting sustainable finance. we ensure stable financing conditions and make sure that banks are sound and resilient. these are necessary conditions for long - term planning and investments in sustainable innovations by companies and investors. in addition, central banks are analytical powerhouses. we monitor the state of the economy and can share our outstanding expertise. central banks need to protect their balance sheets from climate risks as well. this is why last week, the eurosystem decided on further steps to incorporate climate change considerations into its monetary policy operations. step by step, we will decarbonise our corporate bond holdings. that means that we will look at the climate performance of the bond issuers and increase the share of assets issued by companies with a better climate performance. this will create an incentive for companies to improve their climate performance. that way, we are catalysing the greening of the financial system. 6 conclusion ladies and gentlemen, allow me to conclude. we are facing unprecedented challenges. the question is not if but how our economies will change. in times of geopolitical, economic and climatic upheaval we all must be ready to adapt to new realities. that goes for the aviation industry as much as for every other industry. let ’ s get to work. footnotes : 1. cresswell - clay et al. ( 2022 ), twentieth - century azores high expansion unprecedented in the past 1, 200 years. nature geoscience 1 – 6 [ https : / / www. nature. com / articles / s41561 - 022 - 00971 - w. epdf? sharing _ token = jklz5ttrzc7er8guiwf6drgn0jajwel9jnr3zotv0njf2mqj3gnnp2gk0lvghsjzk _ a57jgsx9ewnlvhndsl2haid99h5i16iyohbvkk1dxvehqj02s2dw [UNK] 2. european investment bank ( 2022 ),