Lagarde also reiterated her call for further resources for the IMF, calling it one of her "top priorities."
The IMF head made the remarks in Rio at an environmental summit with global leaders.
Calling climate change "one of the great challenges of our time," Lagarde stressed the need for nations to adopt fiscal policies that impose higher costs on the worst polluters. Specifically, she called for policies such as environmental taxes or emissions trading systems.
"It is basically a variation of the old mantra: 'you break it, you buy it,'" she said.
Beyond the impact of those policies in helping the environment, Lagarde noted pragmatically that many nations could use the added revenue that would come from them. She noted that if the United States were to adopt a $25 carbon tax on every ton of carbon dioxide, which would raise the price of a gallon of gas by about 22 cents and reap the government over $1 trillion over 10 years.
And finally, she said any economic growth policies must ensure that the gains are spread equally among the social classes, emphasizing the need for nations to create jobs across the spectrum.
"Decent and steady employment is the sure foundation of human dignity, the best avenue to rewarding and fulfilling lives," she said.