mario draghi : the target2 - securities framework agreement address by mr mario draghi, president of the european central bank, at the event marking the first signatures to the t2s framework agreement, frankfurt am main, 8 may 2012. * * * ladies and gentlemen, i am very pleased to welcome you to frankfurt today on the occasion of the signing of the t2s framework agreement by a first group of central securities depositories, or csds. t2s is an important project for the eurosystem and for europe. it is a key component of the european market infrastructure, and the governing council of the ecb remains committed to delivering it. i fully share this commitment, and i am glad to be here today representing the eurosystem, together with fellow governor visco, and other colleagues from national central banks. allow me to thank them for taking the time to be here with us. i joined the governing council as governor of banca d ’ italia in early 2006, and it was around that time that we started discussing t2s. it was in july 2006 that we decided to consult and involve european csds and market participants, to ensure that t2s would fulfil the needs of the market. the main reason for the eurosystem to embark on this project was to address the costly fragmentation of securities settlement market infrastructure, and to achieve greater technical harmonisation in the european securities settlement market. t2s allows for efficient and integrated securities settlement. the fundamental objective of t2s is to contribute to making europe a better place to invest, by fostering a single market in post - trade services. it will make financial markets safer and more efficient, and it will increase transparency in the post - trade environment. ultimately, investors will benefit from lower cross - border transaction and liquidity costs and from better investment possibilities. issuers will benefit from deeper and more diversified sources of funding. t2s is important for europe. it will be a major contribution to the strengthening of the single market. the single market has already brought many benefits, which are, at times, forgotten or taken for granted. it is during times of crisis that we should not allow our commitment to the cause of further market integration to fade. it is during difficult times that we should remember the importance of cooperation and coordination. there has been much progress towards further integration in recent years. the most visible example was the adoption of the single market act in april 2011 by the european commission.

, known as scope 3 emissions. in many sectors, this is crucial for understanding a company ’ s climate risk. we will also work on other climate - related issues where we believe international standards may be useful. one example is the use of emission allowances. our work with companies begins with setting clear expectations. we have formulated our expectations in a set of expectation documents. when it comes to climate change, we already expect companies to have a climate strategy, set emission targets, report on progress, and stress - test their business models against various climate scenarios. in future, it will be natural for us to emphasise towards a net zero emission horizon. this will give clearer direction to our ownership activities. exercising ownership active ownership will play a key part in work on addressing the fund ’ s climate risk. a dialogue with companies will be particularly important. chart : climate increasingly a dialogue topic our dialogue with companies reflects our expectations. last year, we held around 3, 000 meetings with companies. as you can see from the chart, sustainability is increasingly on the agenda. 3 / 6 bis central bankers'speeches we plan to increase both the breadth and the depth of our climate - related ownership activities. we will give particular priority to the highest - emitting companies and companies that have not published climate plans or have inadequate climate reporting. we will also step up our ownership activities aimed at the financial sector, which is exposed indirectly to climate risk through loans and investments. we tailor our dialogue to the sector and the situation. steel and cement are good examples. these companies currently have high emissions, but their products will still be needed in the lowcarbon economy. much of our dialogue on transition plans is therefore about the technological advances and investments needed. we also raise the need for industry standards and the issue of lobbying, which is a major challenge. chart : companies ’ climate reporting is improving we are seeing signs that our efforts are paying off. for example, when we analysed the reporting of 1, 500 companies, we found that those we have actively engaged with have made more progress in their reporting on climate strategy than the other companies. of course, we cannot claim all the credit for this progress. but progress it is. in future, we will provide more information on our dialogue with companies – what we talk about and the changes we see. drawing attention to it is a tool in itself. reporting and voting our dialogue with companies will not have the desired result in every case. we can then hold boards to account