however. according to a study by kpmg, these are projected to total around €9 billion. 4 reports in the press recently made frequent mention of a “ wave of regulation ” inundating the banks ’ it. there was even talk of “ excessive regulation ” or a “ regulatory tsunami ”. with all sympathy for the great challenges that the banks are facing, we should not forget why these demands arose. they were due to sometimes glaring errors in developments and to a lack of meaningful possibilities of analysing the data that existed at the banks – both before the crisis and to this very day. what we have observed from inspections at the banks is that it at most banks is suffering from data not being collected and maintained in accordance with uniform standards and that there are only limited automated facilities for analysing these data and thus utilising them for a forward - looking risk management. risk silos exist. the outcome of this is that the management often finds itself in a situation where decisions have to be made with insufficient knowledge of the facts. this chiefly concerns banks with an international focus, which admittedly find it difficult to coordinate it spread over a large number of locations. more than for others, however, it is absolutely essential for them to do so in order to hold their own in a volatile economic environment. the whole thing is not just a problem for german banks ; according to a study by the basel committee, it concerns more or less all international banks. it goes without saying that no “ data graveyards ” should be created. i think that, together with the financial institutions, we will strike a healthy and, above all, viable balance in the future as well. furthermore, many of the regulations have not been newly invented ; they are already national banking supervision reality. in germany, for example, the implementation of section 25 of the banking act ( kreditwesengesetz, kwg ) and the minimum requirements for risk management ( mindestanforderungen an das risikomanagement, marisk ) means that many of the mentioned requirements are already common practice among supervisors. warren buffett is quoted as saying “ someone is sitting in the shade today because someone planted a tree a long time ago. ” as i see it, the it departments that have consistently and promptly implemented the requirements of earlier inspection practice are well equipped for the future demands of it. the new “ principles for effective risk data aggregation and risk reporting ” ( bcbs 239 ) adopted by the

sabine mauderer : reaching net zero - the risks of idle bystanders keynote speech by dr sabine mauderer, member of the executive board of the deutsche bundesbank, at the net zero delivery summit, london, 4 june 2024. * * * check against delivery 1. introduction my lord mayor, ladies and gentlemen, albert einstein observed that the most serious threat to our world comes not from those who do evil, but from those who stand by and watch. sadly, this famous remark applies just as aptly to the topic of climate change. the scientific evidence is clear, with numerous studies already outlining the economic damage that climate change is likely to cause and is already causing. yet, global climate policies that would mitigate these enormous economic threats are not in place. fossil fuel demand is still on the rise1, so are the prices of the shares of the oil industry. so, investments in oil are relatively attractive for investors. at the same time, there is a wide climate financing gap, estimated at almost us $ 7 trillion per year. 2 this discrepancy is easy to explain. it is merely a consequence of ( private ) investors looking for attractive returns and reacting to current price signals. so, for many market participants, the risk - return profile of investments in oil and gas still seems to be very attractive. however, it seems to be important that markets price in medium and longterm financial and economic risks. my job as a central banker is to worry exactly about both these categories of risks, financial and economic. think about risks stemming from extreme weather events such as droughts, floods and wildfires. these are already putting substantial pressure on our economies, including on inflation. according to the latest study, as a result of future warming, annual food inflation is expected to increase significantly, by between 1 and 3 %, at a global level, by 2035. 3 i am speaking to you today as the chair of the network for greening the financial system ( ngfs ), a network of more than 130 central banks and supervisors worldwide. our goal is to analyse climate and nature related risks and address them accordingly. today, i will outline some of the work we are doing. 2 main part 2. 1 climate scenarios central bankers, supervisors and investors have at least one thing in common : they base their actions on data and models. one should not react to what one does not understand. yet, climate change calls for new kinds of data