You have the opportunity to shape these disclosures as they become market standards. We encourage the private sector to: 1. Contribute to the review of the current TCFD framework that Mary Schapiro is leading. Tell her what’s important, what’s less so, what should be refined to ensure disclosures are decision-useful, comparable, consistent and efficient before they become mandatory. 2. Commit to reporting a full set of TCFD disclosures in the 2021/22 reporting round: The selfhelp community for TCFD is considerable. Through multi-sector TCFD summits and more focused TCFD industry preparer forums, companies can continue to share knowledge to improve disclosure practices.8 Full disclosure encompasses scope 1, 2 and 3 emissions and includes a strategy for managing these down, embedded through appropriate board-level governance structures and linking outcomes to compensation.9 3. Demand TCFD-consistent disclosures from your borrowers and the portfolio companies. In the process, you will unleash tremendous value and be better able to manage embedded risks. For COP 26 we will work to develop pathways, in consultation with international standard setters - such as the FSB, IFRS and IOSCO – and national authorities to determine the best approaches to making climate disclosure mandatory. Risk management: ensuring firms and investors can measure and manage the risks in the transition to a net zero world. The second step on the path to a sustainable financial system is better climate risk management. Managing climate-related financial risks requires disclosure to go beyond the static (a company’s carbon footprint today) to the strategic (their plans to manage down their emissions).

But risk managers know that having adequate levels of capital does not ensure success - or even longterm survival. In calm seas, everyone is a pilot. Only rough waters prove the skill of a ship’s crew. Supervisors and risk managers know that a bank’s management and controls make up its first line of defence. The New Basel Accord seeks to capture the relationship between capital adequacy and risk management, a relationship that is quite apparent in its approach to operational risk. I’d like to take this opportunity to discuss the latest news on the New Accord and some of my thoughts on the framework for operational risk. I’ll begin with the Committee’s announcement from two weeks ago about plans for finishing the New Accord. I’ll then share some thoughts on the treatment of operational risk and the Committee’s motivation for adopting an explicit charge for it. Given the interest that this proposal attracted, I’ll address three important themes raised in public comments that the Committee is currently considering. During that discussion, I’ll offer some thoughts on what lies ahead, not just for bankers, but also for supervisors in conducting and coordinating supervision under the New Basel Accord. BIS Review 45/2003  1  Recent developments: the October press release First, to the most current news. By now you’ve no doubt read that the Basel Committee agreed two weeks ago on a plan to address the final issues raised in public consultations over the summer and to complete the new rules.