jessica chew cheng lian : advancing environmental goals through sustainable finance initiatives in malaysia speech by ms jessica chew cheng lian, assistant governor of the central bank of malaysia ( bank negara malaysia ), at the launch of " nature nurtured / pameran lestari alam " exhibition, kuala lumpur, 19 january 2017. * * * malaysia attracts millions of tourists each year, many who come for the beautiful and unique attractions that nature has to offer in our country. today, we celebrate this through art, and by bringing art and nature together, we hope to draw more attention to both. this exhibition, ‘ nature nurtured ’, continues bank negara malaysia ’ s efforts to preserve our natural heritage, and follows closely on the heels of steps that we took in 2016 to restore the natural habitat of the grounds in shah alam where the bank ’ s brand new automated cash centre now stands. the region ’ s natural treasures have been a magnet for merchants and travelers for centuries. spices were what brought the european powers to southeast asia six hundred years ago, while the chinese came in search of fine food and medicine. almost exactly 200 years ago, general farquhar, the resident of malacca, commissioned a team of artists to paint every aspect of the peninsula ’ s wildlife. efforts to document nature through art had, however, existed long before. i should mention that women, too, counted among the talented observers of life forms who went on to capture nature in vivid artistic creations that have informed and inspired generations. maria merian, one such famous artist from the 17th century, was recently celebrated for her works at an exhibition at buckingham palace last october. merian ’ s work which featured detailed drawings of plants and insects are preserved to this day in private and academic collections all over the world. i confess i knew nothing about maria before this week. having now seen specimens of her incredible body of work, i can only imagine the sensation she would have created in her time with the quality and eye for detail that brought her drawings to life – and on a subject like insects, of all things, which were her passion. they are immensely, strikingly beautiful. we hope the artists of ‘ nature nurtured ’ will receive the same appreciation. the artists in this exhibition do much more than record what anybody with a handphone can manage these days. they immerse us in the natural wonders that surround us, from the bustling cities to the more distant hinterlands. whatever the setting, every

capital level during the current favorable economic environment so that they could weather vulnerability during downturns and crisis situations. ladies and gentlemen, while the responsibility for strengthening competitiveness rest with the banking institutions, bank negara malaysia plays an important role in spearheading the development of the banking sector. in realising the vision of a progressive and dynamic banking system, bank negara's policy initiatives aim at providing a more conducive environment that encourages innovation and competition, while maintaining the safety and soundness of our banking sector. in line with this, bank negara malaysia will ensure its prudential framework is adaptable to changing market circumstances and business practices, and does not contain features that might inhibit banking institutions from upgrading their capabilities or delaying their response to changes. our regulatory approach has shifted away from prescribing detailed rules towards " principle - based " regulations. there is now greater focus on providing " incentive compatible " parameters that encourage banking institutions to conduct their businesses prudently, whilst allowing them the flexibility to develop strategies within the broad principles. over time, our regulatory and supervisory framework would rely more on market discipline through increased disclosure and transparency. in this respect, shareholders are expected to play a more active role in overseeing the performance of banking institutions and the effectiveness of management in conducting the business in an efficient and professional manner. as we advance into the second phase of the fsmp or the financial sector masterplan plan, progressive liberalisation will take place to level the playing field for domestic and foreign banking institutions. to this end, greater operational flexibility will be accorded to the existing foreign banking institutions. bank negara malaysia has, in addition, granted three new full - fledged islamic banking licences to foreign financial institutions. additionally, foreign direct investment of up to 49 per cent has been allowed in the equity holding of the islamic subsidiary of a commercial bank. the overall market shares of local and foreign banking institutions have not changed drastically, but there has been qualitative improvements in operational efficiency, service levels, risk management and corporate governance standards. over time, as the industry further evolves, bank negara malaysia will reassess the environment before deciding on further liberalisation measures. ladies and gentlemen, macroeconomic and financial conditions are evolving swiftly, posing more significant challenges and lending urgency to accelerating efforts towards realising our vision of a more progressive and dynamic financial system. greater commitment towards enhancing strategic competence and organisational effectiveness are critical as we strive for higher standards of performance and greater efficiency in