MAS is also involved in the Basel Committee Task Force on Climate-Related Financial Risks, which is analysing the transmission channels through which climate risks affect financial institutions and developing methodologies to quantify these effects. Stress testing is a very useful tool to assess the impact of the physical and transition risks associated with climate change. MAS will conduct by end-2022 stress tests on the financial industry under a range of climate 2/9  BIS central bankers' speeches  change scenarios. We will reference climate scenarios developed by the NGFS and best practices in climate stress testing approaches taken by other regulators. We need to urgently enhance the quality and consistency of climate-related disclosures. Reliable and comparable climate-related disclosures are critical for: better pricing of climate-related risks; more effective risk management and market discipline; and effective allocation of capital towards financing green and transition activities. The lack of consistent climate disclosure standards has resulted in selective reporting against different frameworks, impeding the growth of sustainable finance globally. MAS is encouraged by the recent acceleration in progress towards a global sustainability reporting standard. The G7 countries have expressed support to move towards mandatory climate-related financial disclosures. The G7 has also agreed on the need for a baseline global reporting standard for sustainability which jurisdictions can supplement. Efforts by the International Organisation of Securities Commissions (IOSCO) and International Financial Reporting Standards (IFRS) Foundation towards a baseline global sustainability reporting standard have gained significant momentum and support.

As a first step, we will disclose the Weighted Average Carbon Intensity (WACI) of our equities portfolio relative to market benchmarks. Carbon intensity measures the carbon emissions per unit of revenue of the company. The WACI is derived from the carbon intensity of revenues of each of the companies in the portfolio, weighted by the relative size of the investments in those companies. MAS’ equities portfolio has a lower carbon intensity than its market benchmarks. As at end-March 2021, the WACI for MAS’ Emerging Markets equities portfolio was 30% lower than its benchmark while the WACI for MAS’ Developed Markets equities portfolio was 3% lower than benchmark. We will continue to monitor MAS’ portfolio WACI over time and seek to understand the impact of our portfolio actions on WACI levels. A SUSTAINABLE ORGANISATION Finally, as a corporate citizen, MAS is accountable for reducing and reporting its own carbon footprint. We aim to build a sustainable organisation and have advanced on two fronts: measuring our carbon footprint; and developing strategies to reduce our footprint. MAS has substantially established its carbon profile across Scope 1, Scope 2 and Scope 3 emissions. Scope 1 emissions, namely from sources controlled or owned by MAS, are negligible. Scope 2 emissions, namely from purchased electricity to power our office premises, have been on a downward trend. Scope 3 emissions, namely from corporate activities such as air travel, currency operations, and waste incineration, account for most of our carbon profile.