The key mandates of the Joint Committee are to: Build capacity through the sharing of knowledge, expertise and best practices in assessing and managing climate-related risk; Identify issues, challenges and priorities facing the financial sector in managing the transition towards a low carbon economy; and Facilitate collaboration between stakeholders in advancing coordinated solutions to address arising challenges and issues. Beyond resilience As we intensify our efforts to increase climate resilience, let us not forget that climate action begins with each of us. For the Bank, this has meant making changes to our own internal operations to reduce our carbon footprint. For several years now, we have been watering our grounds using rainwater harvested by our roofing systems. We have also actively reduced our 4/5  BIS central bankers' speeches  carbon footprint in our currency management operations. We print fewer brand new notes and use durable polymer banknotes to prolong their lifespan in circulation. We also employ coprocessing, where shredded old notes are converted into productive energy – this has saved 440 tons of CO2 emissions since 2016. The Bank has also embarked on a digitalisation strategy that will significantly reduce internal usage of paper. We have also progressively moved to incorporate wider sustainability considerations in our investment decisions. Within the financial sector, the leadership shown by the Islamic finance industry in adopting value-based intermediation is a positive step towards sharpening the focus of finance on creating a positive impact to the economy, people and the environment.

Ultimately, this exercise would provide valuable insights on how to 3/5  BIS central bankers' speeches  best integrate climate-related risks into the Bank’s macroeconomic and financial surveillance activities and feed into wider policy responses to climate change. Third, we will need to address the appropriate treatment of climate risks within the prudential and supervisory frameworks for financial institutions. As a start, the Bank will require financial institutions to report their exposures to climate risks once work on the green taxonomy has been finalised. Information gathered through this process will be used by the Bank to consider changes to prudential standards to better reflect risks from climate-related exposures. Concurrently, the Bank also intends to align, where relevant, the reporting requirements for climate-related risks with the Value-Based Impact Assessment Framework (VBIAF), which will be finalised by October this year, as well as its corresponding VBIAF Sectoral Guide, which is currently being developed. In addition, the Bank will increase its engagements with individual financial institutions to better understand how they consider climate risks in their risk management approaches and practices. Fourth, we need to strengthen the use of disclosures more broadly, to provide greater transparency on how climate risk considerations are integrated into business decisions. Such disclosures, by both financial institutions and non-financial firms, will help drive action towards more effective risk mitigation and better adaptation to climate change. To this end, the Bank will work with the industry to implement the recommendations of the FSB Task Force on Climaterelated Financial Disclosures (TCFD) in Malaysia.