can agree and implement key common minimum standards. that impulse to work together, internationally, to provide stronger governance of the global financial sector will inevitably wane somewhat the further in time we get from the crisis in which this was born. i don ’ t think the more powerful, more comprehensive international machinery that has been built since the crisis will disappear. but the challenges will change. it will need increasingly to pivot from design of new international standards to ensuring consistent implementation across jurisdictions. it will need to be prepared to speak out loudly when standards are not being met. where standards have been met, it will need to encourage national authorities in one jurisdiction to recognise and defer to equivalent regulation and supervision in another. and it will need to monitor and address risk throughout the system. of course, while i think and hope we can continue and indeed reinforce the international governance that has been developed, it is not a given that we will succeed. it is very much in everyone ’ s interest to ensure that we do. if we cannot ensure consistent application of international standards, the result is very unlikely to be more unconstrained global financial activity of the sort we saw before the crisis. rather it is likely to be the further rolling back of financial globalisation to the detriment of the global economy as national regulators feel compelled take local action to protect their own jurisdictions. bis central bankers ’ speeches intensive supervision it is not all about new approaches to regulation – to how you set the rules. it is also about new approaches to supervision – to how you apply those rules, day to day. from the outset, a key element of the international reform agenda has been more intense and more internationally co - ordinated supervision of systemically important firms. unlike macro - prudential policy, micro - prudential supervision – the supervision of individual financial firms – is not at all new. but it has changed materially. i recall quite clearly from my time at the treasury, in charge of financial regulation in the early years of this century, the underlying belief among the regulatory and supervisory authorities that the management and boards of firms had an even stronger reason than the supervisor to control risk and the safety and soundness of their firm – and that they had the capacity and capability to do so. the crisis revealed a very different picture in many institutions worldwide. we have learned from this experience. in the uk, the prudential regulation authority ’ s new and more intensive supervisory approach reflects this. there is also a much

andrew bailey : the case for an open financial system speech by mr andrew bailey, governor of the bank of england, at the financial and professional services address, mansion house, london, 10 february 2021. * * * as we look forward – and for so many reasons we must look forward – it is important to focus on the future of financial services, and the important role they play in our economy and internationally. this will be my focus today. i am going to look forward with the benefit of history and context and set out why open financial markets are in the interests of all – home and abroad – and something we should always strive for. i want to start with the bretton woods agreement towards the end of the second world war. this was a fundamental and decisive commitment to an open world economy. this commitment did not come free at the time – the adjustment was hard for this country – and of course the more formal bretton woods system broke down in the 1970s. but that breakdown did not compromise the commitment shared broadly across nations to an open world economy. there have been times when the commitment has been sorely tested, but it has not been abandoned. what followed the breakdown was a shift of emphasis, not a free for all. the shift was towards managing the consequences of greater openness with much more emphasis on the stability of the financial system and its ability otherwise to do harm, both domestically and internationally. what was needed was not just openness, but safe openness. this emphasis was never more evident than during and after the global financial crisis. there was a moment at the height of the financial crisis when it might have been natural to consider forfeiting the commitment to an open financial system in the face of damaging international linkages. that did not happen to our great relief – the g20 nations stood firm to the principles of bretton woods and committed to significantly reforming the international financial system and its regulation, by raising global standards for regulating the system and reinforcing the institutional structure. the covid crisis has been the first big test of those reforms – and it has been a big test. the scorecard to date is encouraging – by no means perfect, but the core of the system has stood up well, which is needless to say a huge relief. in order to preserve this public good of an open world economy and now also an open financial system, has required a commitment to institution building both internationally and domestically. bretton woods created the imf and world bank,