Together, the Monetary Authority of Singapore (MAS) and the Bank for International Settlements (BIS) are investigating how integrating regulatory and climatic data can provide insights into financial risks associated with climate change.
The two institutions have created a roadmap for a climate risk solution called Project Viridis, which intends to assist financial authorities and central banks in “identifying, monitoring, and managing climate risks in the financial system.”
The Ellipse Data and Knowledge Platform (EDKP), developed by the BIS Innovation Hub Singapore Centre and MAS under Project Ellipse, is a key component of the Viridis platform, which was first unveiled in 2022.
The “blueprint” outlines the characteristics and metrics needed for a platform that manages climate risk. It highlights the importance of data and information on financial emissions, physical risk exposure, and “forward-looking assessments under different climate scenarios” for any instrument that manages climate risk.
According to Maha El Dimachki, head of the BIS Innovation Hub Singapore Centre, “the need for adaptive and forward-thinking strategies” in response to “the impact of climate change on the global financial landscape” gave rise to the Viridis platform.
The two organisations have previously collaborated on projects together. For example, BIS and MAS collaborated with other financial institutions to test the cross-border settlement capabilities of wholesale central bank digital currencies (CBDCs) across three key global markets as part of Project Mariana, which was launched in 2022.