⁍ Since taking the helm a year ago, Christine Lagarde has turned the European Central Bank’s attention to social issues like climate change and inequality.

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⁍ Lagarde’s efforts to use the bank’s leverage to fight global warming, gender imbalance or income inequality may have been overshadowed by the coronavirus pandemic and the ensuing, deep recession.

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⁍ They could yet reshape the currency union’s most powerful institution and help redefine the role of central banking in an era where the threat of runaway inflation has faded into obscurity.

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– The European Central Bank is taking a new look at issues like income inequality and climate change—and some of the bank’s critics are not happy about it, Reuters reports. “If the central bank behaves like an ostrich, sticking its head in the sand, it’s going to lose its independence by default,” says the governor of Latvia’s central bank. “If it wants to retain its independence and remain relevant to society, it needs to listen and demonstrate it wants to help.” Germany, the ECB’s biggest shareholder, has already challenged the bank in the courts, and some members of the European Parliament say the bank has “no mandate to pursue other aims in (its) own right or to play an active role in other policy areas.” The bank’s president, Christine Lagarde, has said she wants to use the bank’s power to address social issues. “We need to enlarge the horizon and be courageous in tackling some of these issues, although they are not the traditional areas that monetary economists look at,” she said last week. “Climate change was not lingua franca in those days.”