assessing how their business and operations could be affected by climate risks. throughout the journey of conducting the stress test, financial institutions will uncover gaps related to data, technology, and methodologies. this serves as a starting point for the institution to assess their internal capability and find 1 / 3 bis - central bankers'speeches ways to address these gaps. in other words, the climate stress test is a forward - looking tool to help financial institutions in identifying, measuring and mitigating their climate risk exposures. when designing this stress test for malaysia, at bank negara malaysia, we have strived to incorporate learnings from other jurisdictions, including adapting and incorporating several malaysia's specific elements in terms of its economic structure and financial system. we have also incorporated feedback from domestic industry players. in this regard, i would like to take this opportunity to extend bank negara malaysia's gratitude to many of you here who have provided invaluable feedback during the drafting of the methodology paper and reporting template. we truly appreciate the open and collaborative spirit extended by everyone, an approach that continues even up to today. climate risk stress testing is still in its infancy globally. therefore, we have strived to balance between pragmatism and accuracy when specifying our requirements. where possible we have tried to work around data limitations, lack of technical expertise as well as under - developed modelling techniques. however, considerable challenges remain for financial institutions to successfully run this stress test. we will journey with you through these challenges. it is as much a learning experience for bank negara malaysia as it is for all the financial institutions running the stress test. that is one of the reasons we are all here today at this workshop. i believe that together we can overcome many of the hurdles. climate risk is a collective action problem. it may be in each individual's best interests to act selfishly, regardless of what other individuals do. however, if all individuals act selfishly, then the outcome for everyone is worse than if we all cooperate. at the country level we see this playing out in global emissions reduction. a single small country may feel that spending money to cut emissions may do little for global climate change, and hence choose not to do so. however, such situation could lead to some other, or even all, countries, to opt not to cut emission, and thus, we will end up in a bad outcome globally and having the adverse impact of unattended climate risks being faced collectively. at the individual

##arching objective of the climate risk stress test in safeguarding our financial system. through crst, we are not only strengthening our institutions'resilience to climate - related risks but also building a solid foundation for long - term sustainability. this workshop today provides a great opportunity to kickstart meaningful conversations around crst. the agenda has been carefully curated to promote deep learning and knowledge sharing, with a strong emphasis on practical applications and addressing real - world challenges in conducting the stress test. i encourage all participants to actively engage and share insights throughout the workshop. let me end with the words of sir david attenborough " if working apart we are a force powerful enough to destabilise our planet, surely working together, we are powerful enough to save it. " i urge you to stay committed to this journey, continue collaborating, and share your experiences. while past and current actions and inactions created today's climate problems, our generation must lead the way in fixing it for our children. i have every confidence in our sector's ability to rise to this challenge and lead the way in building a climate - resilient financial system. with this, i wish you a productive workshop ahead. thank you. 3 / 3 bis - central bankers'speeches