Financial Stability and Systemic Risk: Lenses and Clocks

The report advocates for a re-engineering of the global financial system by applying sustainable finance principles to mitigate systemic risk. It proposes the use of 'lenses' for a more granular understanding of diverse risks and 'clocks' to balance short-term quantifiable risks with long-term 'creeping risks'. The document identifies six critical areas for reform: over-the-counter markets, institutional investor accountability, stock exchange listing requirements, Basel Committee banking risk, credit rating agencies, and Solvency II insurance stability.

• The paper advocates for the adoption of 'lenses' to provide greater depth and granularity in understanding a wider range of risks, and 'clocks' to prevent the over-emphasis of short-term quantifiable risks at the expense of slow, long-term risks that destroy value.
• The report identifies six specific areas where sustainable finance and investment thinking are relevant to the re-engineering of the financial system: over-the-counter markets, institutional investor accountability, stock exchange listing requirements, systemic risk and the Basel Committee, the role of rating agencies, and Solvency II.
• Financial policy-makers are urged to incorporate values of transparency, accountability, responsibility, and trust to create a more resilient financial system for globalized markets.

APA

Brown,, P. C.-H. B. R. H. G. (2012). Financial Stability and Systemic Risk: Lenses and Clocks. International Institute for Sustainable Development. https://www.iisd.org/publications/report/financial-stability-and-systemic-risk-lenses-and-clocks-june-2012

Chicago

Brown,, Paul Clements-Hunt,Foreword by Rt. Hon. Gordon. Financial Stability and Systemic Risk: Lenses and Clocks. International Institute for Sustainable Development, 2012. https://www.iisd.org/publications/report/financial-stability-and-systemic-risk-lenses-and-clocks-june-2012.

Wikipedia

{{cite report |last1=Brown, |first1=Paul Clements-Hunt,Foreword by Rt. Hon. Gordon |title=Financial Stability and Systemic Risk: Lenses and Clocks |publisher=International Institute for Sustainable Development |date=23 June 2012 |url=https://www.iisd.org/publications/report/financial-stability-and-systemic-risk-lenses-and-clocks-june-2012 |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{brown2012financial, author = {Brown,, Paul Clements-Hunt,Foreword by Rt. Hon. Gordon}, title = {{Financial Stability and Systemic Risk: Lenses and Clocks}}, institution = {International Institute for Sustainable Development}, year = {2012}, month = jun, url = {https://www.iisd.org/publications/report/financial-stability-and-systemic-risk-lenses-and-clocks-june-2012}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }