The European Central Bank must take climate changes into account when making decisions because they have a clear impact, especially on inflation, said ECB president Christine Lagarde in an interview given to the Madame Figaro publication on Thursday, Reuters reports.

“With more and more climate disasters, drought and famine occurring in the world, there will be repercussions on prices, on insurance premiums and on the financial sector. We must take them into account,” said Lagarde.

The head of the ECB added that he can imagine that there will be a rapid harmonization and tightening of different environmental and governance standards.

A year ago, the ECB laid out its expectations on climate risks, but so far banks have been slow to adapt and the Frankfurt-based institution has repeatedly called on them to pick up the pace.

The ECB is putting pressure on companies and banks to understand and manage climate threats and the possibility that polluting companies will be removed from the market, according to Agerpres.

The European Central Bank has established a center of expertise dedicated to climate change, which will advise the ECB on how to incorporate environmental aspects into monetary policy and banking supervision. Around 12 people will work in the new centre, which will work with existing teams within the ECB.

“We have decided to establish a new climate change center to bring together more effectively the different types of climate expertise that exist within the bank. Climate change affects all areas of our policy,” said ECB President Christine Lagarde.