the global mainstream, to become a core building block in our efforts towards forging a more sustainable financial architecture going forward. similarly, decisions and solutions to finance need to also be considered on a global scale and not confined to any community or nation. bis central bankers ’ speeches of equal importance, the benefits of finance should be extended across all segments of society. despite the size and scale of our financial sectors in the global financial system, many households and businesses still remain excluded from formal financial services. globally, as many as 2 billion adults do not have access to a bank account. perhaps even more revealing are the findings that financial exclusion is not limited solely to developing or low - income economies. even in advanced countries such as japan, 3. 4 % of adults remained financially excluded, while in the united states, over 8 % of households are unbanked and 20 % remain underbanked. there is thus a still much important impact that finance can bring about. indeed, in various parts of the world, such greater access is already making a significant impact, particularly for small and medium enterprises, with its market size estimated to double to almost usd14 billion by 2019 from usd7 billion in 2015. there is, however, still scope for such access to be expanded to bring about more balanced and sustainable growth in the global economy. finally, an important aspect of responsible finance requires strong and effective governance. john locke, one of the most prominent 17th century theorists, refers to the concept of a " social contract " in describing the origin of society and its inherent need for governance. the erosion of this social contract and of governance would drastically weaken the foundations of society, setting the stage for its eventual decline in the future. this was evident during the global financial crisis. the experience serves as a strong indication that the own version of the " social contract " in finance should not be overlooked. this extends not only to governance but also to trust, which has traditionally been the social bond between finance and humanity. central to this is the realisation that financial markets cannot operate in the absence of trust, which in turn necessitates minimum standards for governance, ethics and integrity. this involves not only heightened expectations on the fiduciary duty of boards, but the alignment of compensation packages from short - term personal gains towards long - term value creation. in addition, corporate culture also have an important role in entrenching financial goals with ethical values, through the promotion of sound risk taking cultures and ethical codes of

but goes beyond, the predominant objective of enhancing shareholder value. in delivering long term sustainable value, allocative efficiency is achieved in a manner that promotes stability and prosperity in the broader economy and sustainability of the environment. above all, responsible finance aims to optimise its positive impact on society, economic wellbeing and development. over the recent decade, the heightened advocacy for ethical and socially responsible investments has also seen the proliferation of financial instruments that cater for both financial and societal objectives. more importantly, this has moved beyond negative screening, to more impactful approaches involving the adoption of environmental, social and corporate governance ( esg ) considerations in investment and business practices. these have served to align risk and reward in a more sustainable manner. indeed, some global banks and insurers have begun to incorporate sustainability considerations, including environmental concerns in their lending and investment decision - making processes via the adoption of international risk management frameworks such as the equator principles and the unepfi principles for sustainable insurance. these positive forms of finance are increasingly becoming powerful market forces, driving focus into the kind of productive activities needed for long - term growth. bis central bankers ’ speeches islamic finance, a well - established component of responsible finance, is similarly gaining significant growth and prominence in the global financial system due to its inherent orientation towards promoting societal welfare. this includes the propagation of strong ethical values that engenders accountability and trust in its intermediation function, as well as the promotion of risk sharing that fosters entrepreneurship and equitable distribution of wealth. by virtue of its requirement for financial transactions to be supported by genuine productive activities, islamic finance is also deeply rooted to the real economy. all these are hallmarks of islamic finance that underpin greater market discipline and stronger focus towards building sustainable and long term value in capital allocation. collectively, these characteristics enable islamic finance to also serve as an effective model for responsible finance. on the path to achieve stronger, more balanced and sustainable growth, the potential of responsible finance has therefore become greater than ever. most important is for finance to be aligned towards its ultimate goal of serving humanity and of uplifting social wellbeing. thus, more than merely performing its role as a passive intermediary of funds, finance today has the distinct potential of catalysing and shaping social outcomes. as mobilisers of funds towards socially empowering activities in the economy, the financial sector can act as a " social multiplier ", significantly expanding the impact of positive finance. this is what