regulatory capital requirements appropriately reflect their risk. while critically important, capital alone does not define an institution ’ s strength. it is vitally important for firms to continue to invest in strong internal controls and to make sure that advances in the operational infrastructure keep pace with rapid growth, particularly in complex transactions. strong operational controls can help ensure smooth market functioning in times of stress, and when they are weak they can exacerbate adverse market dynamics. an important element of a sound operational control environment is timely and accurate information for senior managers, especially when it is most critical for them to have a clear picture of the firm ’ s exposure. as such, strong operational controls can help reduce some dimensions of uncertainty and therefore help markets function better in conditions of stress. the challenge of ensuring that operational controls keep up with front office advances in the complexity and volume of transactions is particularly evident today in the area of credit derivatives. the rapid growth in the trading of credit default swaps and structured credit products has resulted in considerable back - office backlogs ( unsigned confirmations and master agreements, delays in trade capture into risk management systems, delayed notification of assignments of positions ) that create significant operational risk for market participants. these types of operational problems have arisen more broadly in the otc derivatives market over time and they have gotten worse with the rapid growth in activity by hedge funds. efforts underway to automate matching and confirmation of credit default swap transactions should help address these concerns. but we need to see a stronger collective commitment by the principal dealers in these markets to reduce the outstanding backlog of confirms, shorten confirm times and move larger share of transactions in the more standardized instruments to automated platforms. and we ’ ll act to reinforce that commitment. these considerations are particularly important for the systemically significant financial institutions that stand at the core of the u. s. financial system. these institutions need to have exceptionally high standards in terms of internal controls, capital and risk management and governance. the greater complexity of their risk profile puts more exacting demands on the risk management architecture and requires a higher margin of capital than would be necessary for a business profile with less volatility and more predictability in returns. and the central role these firms occupy in our financial system and the consequences to other firms and to the stability of the financial system should one of them face significant financial or operational difficulties requires that they hold a higher margin of capital above economic capital than would be appropriate for smaller institutions with a similar risk profile. these arguments are compelling

behind in terms of qualitative participation. let me keep to the netherlands on this point. according to a report by our social and cultural planning office a few years ago, not a single woman sat on the managing boards of the top 25 dutch companies. in the top 100, there was only one woman to over 400 men, and women made up no more than 2. 5 % in the top 5000. the situation on the supervisory boards was better, but with an average of one woman to 12 men, still not exactly positive. and as far as our banking sector is concerned, i am not sure whether we would have sufficient women top managers to create a delegation like yours. as regards the position of women in senior management, i must unfortunately share some of the blame. the nederlandsche bank has one women among the 12 members of its supervisory board. prince claus, the late husband of our queen beatrix, was instrumental in getting her on our supervisory board by stressing time and again that the successor to him should be a woman. our governing board is made up entirely of men, so in that respect we have a lot to learn from your country. two of our eight deputy executive directors are women. while this is an improvement on the past, we still have a long way to go. we are hence actively working on a plan for a larger number of women at the nederlandsche bank, with more advancement to the top. before i tell you how we intend to do this, let me first go into the reasons why women lag behind. both demand and supply factors play a role. as regards demand, all too often, women are passed over as potential candidates for recruitment or promotion. whereas some feel that this is done with intent, i am inclined to think that it is an unconscious process, arising from a stereotyped view of men and women. in fact, research indicates that men are inclined to appoint men, and women are inclined to appoint women. since management traditionally consists of men, it is easy to see where the glass ceiling comes from, and that it will not disappear unless we make a conscious effort. turning to supply, and women themselves have a role to play here, several causes present themselves. women are less self - confident than men, are not as quick to think that they ’ re suitable or to push themselves forward. that is not just my impression, it has been confirmed by psychological research. another factor is that women sometimes have other preferences in respect