Canada’s central climate bank.

In May of last year, Bank of Canada governor Stephen Poloz said staying on for a second term was “obviously one of the options.” Maybe not.

On Dec. 6, before the world’s politicians plunged the planet into the coronavirus economic crisis, Poloz announced he would be stepping down in June at the end of his seven-year appointment. Whether the decision was personal or taken by Finance Minister Bill Morneau and Prime Minister Justin Trudeau may remain a mystery until Poloz writes his memoirs.

A few weeks ago The Globe and Mail cited a source who said Poloz was not offered an opportunity to stay beyond his June retirement to allow for some leadership continuity as the bank tackled the COVID-19 crisis. Instead, the Morneau/ Trudeau team moved swiftly to appoint Tiff Macklem, a former Bank of Canada deputy governor who will return to the bank after serving for six years as dean of the Rotman School of Management at the University of Toronto.

Some were surprised that Trudeau passed over an opportunity to appoint senior deputy governor Carolyn Wilkins as the bank’s first female governor. Gender politics, however, appears to have taken a back seat to another political imperative. Beyond his genuine qualifications as a central banker, Macklem is a green climate advocate and follower of former bank governor Mark Carney in his global crusade against fossil fuels. Macklem was Carney’s deputy at the bank. Also, while dean of the Rotman school, Macklem served as chair of the Global Risk Institute, a group created in 2011 by Carney and former Conservative finance minister Jim Flaherty. It’s alleged objective is “to develop applied and integrative research in financial risk and enhance risk education for organizations around the world.”

But one risk, climate change, ranks at the top of GRI’S agenda. As with all climate fretters, the risk-seeking organization did not anticipate a pandemic risk. Even as the COVID-19 economic panic began sweeping the world in March, Macklem’s GRI produced a report that claimed Climate Change Tops Risk Correlation Ranking.

More importantly, Macklem served as a major advance man for another Trudeauvian climate policy manipulation effort. In 2018, Macklem was appointed to lead an “Expert Panel on Sustainable Finance.” When the panel’s final report was released last June, Macklem said — with the hearty endorsement of Finance Minister Morneau — that “sustainable

CLIMATE IS NOT A JOB FOR THE BANK OF CANADA.

finance needs to become business as usual in the Canadian financial services industry.”

Macklem’s expert panel prescription for “sustainable finance” was a grand call for a massive national industrial strategy approach to investment and finance. “Climate change opportunity and risk management need to become businessas-usual in financial services, and embedded in everyday business decisions, products and services.”

Through 15 recommendations, the panel called for “focused policies” and highlighted the need for “clear industry competitiveness visions and capital plans that would spell out the size and horizon of the investment opportunity.” Every nook and cranny of the economy would be encompassed by scores of panels and agencies — including the Bank of Canada — overseeing economic decision-making.

When Macklem was asked last week how he planned to deal with climate change as governor of the bank, he said what central bankers should say. “We will be looking at climate change, along with a host of other major economic forces acting on the economy, to the extent that they affect inflation.”

That’s an important caveat. The bank should review climate change within the context of the bank’s core mandate, which above all is to focus on inflation and monetary policy.

Unfortunately, Macklem’s caveat is inconsistent with his final panel report on sustainable finance. The Bank of Canada, said the report, should lead a move to “formally integrate climate risks into the supervision of federally regulated financial institutions, and provide clear guidance on related regulatory expectations.”

Another recommendation called on the bank to join Finance Canada to take the lead to “encourage Canadian asset managers to assess their internal climate change competency and build capacity where needed.” The bank should “regularly convene with Canadian asset managers to exchange information on climate-related financial risk.”

Tracking financial stability risk is part of the bank’s role, although the link between climate change is currently largely hypothetical and outside the bank’s core inflation mandate. The word “inflation” does not appear in the 74-page final panel report.

With Macklem installed as Canada’s central banker, sustainable finance appears set to become Canada’s central economic planning tool — a shift advocated by Mark Carney, Macklem’s mentor. Sustainable finance, marvellously described by Peter Foster on this page last year, has its roots in the United Nations and has been adopted by what Foster describes as “a powerful cabal of regulators, billionaires, capitalist foundations and environmental non- governmental organizations, ENGOS. Its point man is Mark Carney, governor of the Bank of England, head of the Financial Stability Board, FSB, and former governor of the Bank of Canada. Its most prominent billionaire supporter is media mogul Michael Bloomberg.”

Carney — now a UN special climate action envoy — was at it again at the end of April during an IMF video stream on how to finance climate policy in the wake of the coronavirus financial crisis. “Every company, in every sector, every bank, every insurer, every pension fund,” said Carney, should adopt a global “net zero” fossil fuel objective.

Could it be that Bank of Canada Governor Stephen Poloz had his doubts about the Carney/macklem sustainable finance movement? Just asking.