’ speeches reinforce the role of eu - level institutions in the management of financial stability in the euro area. with significantly more diverse economies and financial systems, promoting greater regulatory convergence in asia is more likely to proceed on the basis of a set of shared principles for developing and maintaining sound financial systems, while providing for the unique and distinct legal, financial, social and economic structures of individual countries within the region. it will be important to have clarity around the key principles, an inclusive process in agreeing on these principles, and mechanisms that support their effective implementation in individual countries. under such an approach, individual countries will have the necessary degree of flexibility to tailor national implementation approaches to reflect the specific characteristics of their respective economies, while committing to uphold the essential regulatory and supervisory principles that underpin financial stability. with asia ’ s varied experience in weathering financial crises, in developing our financial systems and in implementing the various regulatory reforms, valuable lessons can be drawn from the region to advance the progress and development of our respective financial systems and of the region as a whole. seacen has had an instrumental role for more than 30 years in the efforts to share this knowledge and experience widely among its members through providing a platform for such information sharing and through its research, training and capacity building initiatives. today, seacen takes yet another important step forward in advancing this agenda with the launch of the seacen financial stability journal. we live in a world in which the management of financial stability is a highly complex undertaking, and its dimensions have continued to evolve in an environment that is rapidly changing. it is hoped that the journal will contribute ideas, perspectives and insights and thus generate the intellectual dialogue and discourse on financial stability issues. as a region, asia has many unique perspectives and experiences to share with others facing similar challenges in managing financial stability. i congratulate the seacen centre on this important initiative. i wish it every success and look forward to contributions from seacen members and from the other parts of the world. the journal can have a significant influence in drawing attention to the financial stability issues that are most important and thus contribute towards the thinking and responses on these issues. it is a process that should have an inclusive participation in this important agenda of financial stability. bis central bankers ’ speeches

, we see a clear need to reduce the substantial divergence currently observed across institutions. the bank is exploring various options to encourage better risk management approaches by outlier institutions – including through pillar 2 capital requirements and supervisory assessments to reflect an inadequate consideration of climate risks. building on the implementation of the principles - based taxonomy and the work by jc3 to address data gaps, the bank ’ s financial stability committee has recently endorsed a four - year plan to prepare for industry - wide climate change stress tests at the counterparty level. this work is supported by efforts internally within the bank to model the macroeconomic impact of climate shocks based on defined climate scenarios. and we will be taking further concrete steps to improve transparency on the management of, and exposures to, climate - related risks in the financial sector. to this end, bank negara will finalise plans this year for mandatory climate - risk disclosures by financial institutions in consultation with the financial industry. let me conclude. climate change is an unprecedented challenge. the economy and society cannot be separated from the environment and our actions have to be cognisant of this. while we are making progress, there remains considerable scope for the financial sector to be more deliberate in considering the impact of climate change on risks and strategy. there is significant potential for the financial sector to provide guardrails for economic activities to stay on the path towards a low carbon and climate - resilient economy, and in doing so, avoid a more destructive path that will inflict untold harm on current and future generations. the dutch businessman, paul polman, once said “ climate change is sometimes misunderstood as being about changes in the weather. in reality it is about changes in our very way of life ". financial institutions must take a deeper interest not just in how changes in the weather can affect them, but importantly, in how they affect the weather. the path to a more sustainable future depends on it. thank you. 1 aeon weather, climate & catastrophe insight : 2020 annual report ( back ) 2 aeon weather, climate & catastrophe insight : 2020 annual report ( back ) 4 / 5 bis central bankers'speeches 3 grantham research institute on climate change and environment ( back ) 4 www. accenture. com / us - en / insights / strategy / green - behind - cloud? c = acn _ glb _ sustainabilitymediarelations _ 11307639 & n = mrl _ 0920 ( back ) 5 www. unepfi.