frank elderson : finance and biodiversity day of 16th united nations conference on biological diversity ( cop16 ) - transcript of video recording contribution by mr frank elderson, member of the executive board of the european central bank and vice - chair of the supervisory board of the european central bank, at the 16th meeting of the conference of the parties to the convention on biological diversity – finance and biodiversity day, cali, 28 october 2024. * * * the global economy and finance need nature to survive. analysis by the ecb shows that the economy depends critically on nature : 72 % of non - financial businesses in the euro area – around 4. 2 million individual companies – would experience significant problems as a result of ecosystem degradation. these businesses rely on ecosystem services like fertile soils, timber and clean water. and 75 % of bank loans are tied to these businesses. so, if they run into trouble, the banks that finance them will too. this interdependence underscores why the ecb made nature one of the focus areas of its climate and nature plan for 2024 and 2025. it is also why we push banks under our supervision to manage all material nature - related risks. the ecb does not stand alone in recognising this threat. the value of nature for the economy is acknowledged by the global network of central banks and supervisors for greening the financial system, which has 141 members worldwide. additionally, a recent stocktake by the financial stability board showed that a growing number of policy authorities around the world are considering the potential implications of naturerelated risks for financial stability. in recognition of the vital importance of nature for the economy, international fora must ensure that nature considerations are fully integrated into regulation and supervision, alongside ongoing efforts to account for climate - related considerations. this starts with identifying exposures and vulnerabilities to nature - related risks. while central banks and supervisors are not nature policymakers, we must take nature into account to fulfil our mandate of price stability and safe and sound banks. otherwise, we risk failing to deliver on our mandate. my message on this finance and biodiversity day is clear : if you destroy nature, you destroy the economy. the right conditions must be established for nature – and consequently the economy – to thrive. the economy needs nature to survive. financial stability needs nature to survive. to deliver on our mandate, we need nature to survive. and the survival of nature requires financing. therefore, your success here in cali

will need to manage stakeholder expectations carefully. as the npso ’ s supervisor we will watch closely to ensure the underlying resilience of the payment systems is maintained. npa : resilience at its core as i have said on many previous occasions, resilience is key. this is true both for the current systems being run by the npso, but also as it thinks about its journey to a new payments architecture. one of the npso ’ s key priorities will be designing, developing and facilitating the safe and secure transition to this new architecture that will underpin retail payments in the uk. the npa is intended to replace the three separate systems with an integrated framework which facilitates competition, innovation and interoperability. when i last spoke to this forum i discussed the psf ’ s vision for an npa based on a simplified payments platform and highlighted several key themes from a financial stability perspective. the npso inherited this blueprint for the npa and it is now at the behest of the npso to decide how it will take these plans forward. and this responsibility becomes even more demanding in the face of rapid change. especially since the design and build of the new architecture will pose its own challenges. the npa design must be driven by a strong business case ; and resilience and security need to be built into every step of the npso ’ s process from inception to any ultimate transition from one system to another. the smooth operation of payment systems must remain a priority. any change or upgrade of capability must be managed in a way which minimises disruption or detriment to the important services provided and the wider financial system. the bank ’ s role within this journey i ’ ve talked a lot about the important work that industry is driving, and i ’ m sure hannah and melanie will also touch on this today. however, i also want to reflect on what the bank is doing to prepare for the changes we expect to see in the payments space. not in the least to ensure that we, as a regulator, are not left behind. as i have just discussed, we have a role through our supervision of bacs and fps, and now the npso, to maintain financial stability. we will continue to ensure that financial stability is at the heart of what the payment system operators do and that risks are being appropriately managed, particularly during this time of unprecedented change and innovation, and therefore heightened risk. however, we have also made wider changes to