these criteria into their decisions and actions. and banks are certainly no exception to this trend. banks have, for some time, had corporate social responsibility areas. but their involvement needs to go further. as we supervisors have been insisting, banks also need to incorporate these elements into their risk analysis and management. in this respect, both the european single supervisory mechanism ( ssm ) and the banco de espana have recently published supervisory expectations relating to the inclusion of environmental risk in banks ’ management. we are also working on the inclusion of these risks in the stress test methodology for the spanish financial sector. in sum, banks and supervisors alike are moving along this path, which poses all sorts of challenges. for instance, it is in no way straightforward to envisage these risks as part of the commonly used valuation and measurement methodologies. moreover, there are cultural factors hampering their inclusion, which calls for involvement from the uppermost levels of organisations. and, above all, one of the main challenges is the lack of information, which enormously hinders further progress. allow me briefly to refer to these valuation - based aspects and the absence of data. traditionally in finances there is a tendency to value investments exclusively from the standpoint of economic return. the classic focus of study in finances would be cash flows ; once capitalised or discounted, these enable us to compare different investment options. from a theoretical standpoint, responsible investment reminds us that we should not value and compare different investments looking solely at an excel chart. rather, we should perhaps look at variables that are not directly monetisable in the expected return on each investment. measuring this “ non - monetisable ” return is clearly not straightforward. the approach being followed focuses on the measurement of “ impact ”. for example, environmental sustainability has for some time used measurements that take “ footprints ”, be they carbon, hydric, environmental, etc. in corporate and labour market circles it is becoming commonplace to consider what the value or social impact of a specific activity is, and to attempt to evaluate the economic and labour consequences of regulatory changes. one good example of regulatory impact is the ecological transition bill that is currently pending parliamentary approval. the aim, as you know, is to switch our economy towards an environmentally more sustainable model. this aim is very broadly shared in our society, but its achievement will have large - scale implications for our productive model that may also entail undesirable social consequences. the banco de espana is working with the

”. admittedly, it is not easy to find the right balance between “ bail - in ” and the avoidance of contagion. now, there are some fresh ideas from lerrick and meltzer. they propose, as i understand it, that markets should more or less be left alone in the event of crisis ( bail - in ), but that, nevertheless, the fund should offer a minimum safety net to avoid panic ( by purchasing private creditors ’ assets at a well - defined discount ). at first sight, this looks good. i suspect, however, that we partly shall have the same deficiencies here as mentioned above – only in a new wrapping. x my last point, although it is no less important, is “ institutional co - ordination ”. activity by private market participants is fine, but it is not sufficient. we need some public activity to organise the legislative basis and to provide other public goods in order to maximise global benefits. let ’ s look at the imf and the world bank. there have been many suggestions for improving their effectiveness, from merging these institutions to abolishing them altogether. i cannot say that i particularly like those extremes. rather, in a changed global economic setting, the imf needs a clear mandate. this applies as much to crisis problems as its does to demarcating the imf ’ s institutional role vis - a - vis the world bank. the roles of the imf and the world bank need to be strengthened. they should act as advisers on macroeconomic, structural and development policy issues, but their role as lenders should be limited to that of a catalyst. these objectives are consistent with the articles of agreement of both the imf and the world bank and take due account of the changed environment since the bretton woods institutions were set up : floating exchange rates, liberalisation of capital movements, globalisation of markets, and heightened awareness of poverty problems. the imf is designed as a monetary institution, whereas the world bank is a development organisation. a blurring of their responsibilities is just as undesirable as a merger of the two. the implications for lending have to logically follow from that division of responsibilities. the imf should confine its balance of payments funding to short - term liquidity assistance. the world bank should focus on project financing and sectoral loans. this would involve a redistribution of tasks between the imf and the world bank : the imf should at least confine its long - term