The Governor of the Central Bank has said he is particularly concerned about the practice of "greenwashing", where organisations try to portray that their products and services are environmentally friendly but are not.
Gabriel Makhlouf also said that the issue of climate change is a reality that we cannot ignore.
"Greenwashing' is an area I am particularly concerned about," he told a European Single Supervisory Mechanism Roundtable event this morning.
"'Green’ market practices are currently almost exclusively based on voluntary principles and standards, which leaves a lot of room for different interpretations."
"There is a spectrum of risks here from the accidental error to the deliberate misdeed."
Mr Makhlouf added that the challenge for those overseeing firms is to lead and drive the climate and broader ESG agenda within their organisations.
He said the Central Bank will also play its part and lead by example in its own actions.
"We are broadening our understanding of the nature of financial risks stemming from environmental change and how interlinkages across the economic and financial system might amplify them," he said.
"We must all act now so we do not let the next generation down."
The Governor also highlighted how digitalisation, cloud technology and blockchain are driving change and innovation in ways that could not have been imagined just a few years ago.
"In the realm of payments, we have seen an acceleration of digital transformation, with a surge in online transactions and contactless payments during the pandemic," he said.
He also pointed out how consumer habits have been changing and added that while it is important to embrace the challenges posed by innovations, it is important to ensure they do not adversely impact financial inclusion.
Mr Makhlouf also said that firms need to ensure operational resilience is robust as risks and disruption emerge.
"The pandemic has led to a realignment in thinking," he said.
"It is no longer a case of considering 'what if' disruptions occur, but rather ‘when’ disruptions occur."
"Firms must consider whether they have measures in place to limit the impacts of possible disruption and the capacity to maintain the delivery of critical services to consumers and market participants."
