G-20Y Session
April 12, 9.00-10.30 a.m.
Room I 2-210, the World Bank I Building
(1850 I Street N.W.)
G-20Y Session Panellists
Ksenia Khoruzhnikova, Founder and President, G-20Y Association
Ann Kaplan, CEO, iFinance Canada Inc.
Barbara Kreissler, Advisory Board Member, G-20Y Association;
Head Business Partnerships Group, United Nations Industrial
Development Organization (UNIDO)
Kazuki Kitaoka, Chief OiC, Strategic Planning and Coordination,
United Nations Industrial Development Organization (UNIDO)
G-20Y Session objectives
-Presentation of the G-20Y Association Mission and G-20Y Summit concept
-Overview of the G-20Y Summit 2014 agenda
- Interaction between G-20Y Association and UNIDO
- The current negotiations of the Post 2015 Development Agenda and
engagement opportunities of the private sector
- The link between the Global Development Policy Framework and the G20Y
Agenda for 2014
Who are we? G-20Y Association
“G-20Y Summit International Organizing Committee” Association is a Swissbased organization with its Headquarters in Geneva.
G-20Y Association gathers c-level representatives from national and international
leading companies (aged from 30 to 50), the so-called G-20Y Generation
Who are we? The G-20Y Generation*
The G-20Y Generation is independent from national and political interests and
prides itself on sharing a common G-20Y Vision: achieving greater international
cooperation, sharing innovative ideas and putting mid- and long-term economic
prosperity on today’s international agenda.
The G-20Y Generation of young and successful business and financial leaders
is the first generation for which the participation of 20 countries in a global
economic processes is normal. The G-20Y Generation wishes to concentrate its
efforts on producing, in the twenty-first century, an unprecedented period of
sustainable worldwide economic growth. Mid- and long- term prosperity is the
mandate of the G-20Y Generation. It is our responsibility to put it on today s
international agenda.
*The Concept of the G-20Y
Generation has nothing in common with Generation Y Concept
What do we stand for? The G-20Y Association
Vision
1.Achieving greater international cooperation
2.Sharing our innovative ideas
3.Putting long-term economic prosperity on today’s international agenda
How are we organized? The G-20Y Association Structure
The functions of the G-20Y Association are carried out by separate dedicated entities:
• The Founder and President of the G-20Y Association provides the overall impetus for the organization
and coordinates the work of the IOC in all of the G-20 countries. The President has authority to sign all
G-20Y Association official documents.
• The Business Assembly of the G-20Y Association is an advisory body to the President. It comprises
successful young business and financial leaders representing various G-20 countries. It assists the
President in the organization of the G-20Y Association activities and in the promotion of its initiatives and
values among businessmen and women, governments, press in the respective countries of its members.
Business Assembly members are in charge of speaking about G-20Y Association at different events,
other economic forums, business leaders meetings.
• The Executive Committee gathers together successful young business and financial leaders
representing various G-20 countries, the most active G-20Y Association members for the organization of
the G-20Y Summit every year. The Executive Committee members actively contributes to the
organization, administration and promotion of the annual G-20Y Summit. The Head of the Executive
Committee is a full time employee, who coordinates the daily work of the G-20Y Association’s staff.
• The Advisory Board provides strategic advice and actively participates in the creation of the agenda for
each G-20Y Summit.
What
do we
Recommendations
do?
The
G-20Y
Summits
and
1.The G-20Y Summit: turning the G-20Y Vision into Recommendations
2.The G-20Y Summit: exchanging best business practices and creating
strong bonds
What do we do? The G-20Y Summits and
Recommendations
The objective of the G-20Y Summits has been the preparation of a set of recommendations
by young business leaders to be disseminated across the world and shared, in particular,
with the G-20 Heads of States and leading international institutions and organizations.
The G-20Y Summit participants are c-level executives from national and international
leading companies (aged from 30 to 50).
The G-20Y Summits add value not only to the G20 leaders’ efforts in responding to the
global economic and financial challenges, but also they serve as a unique opportunity for
outstanding young business leaders and individuals in leading positions with governmental
or public institutions to gather together in an exchange of ideas and best practice,
encouraging stronger personal and professional relationships.
G-20Y Summit 2014 agenda
-Focus on items already on the international agenda (e.g., G20 Heads
of Government, Financial Stability Board) versus items which have not
yet gained attention
- Level of generality / granularity / practicality should the G-20Y
recommendations provide
G-20Y Summit 2014 agenda
I. Energy Markets Committee
II. Food Security Committee
III. The City of Tomorrow Committee
IV. Global Demographic Developments Committee
V. Global Financial Reforms – Banking Committee
VI. Global Financial Reforms – Insurance Committee
VII. Global Financial Reforms – Alternative Investments Committee
VIII. Private Infrastructure Investment Committee
IX. Global Trade Obstacles Committee
X. Creating Jobs Committee
Interaction between G-20Y Association and UNIDO
- UNIDO representative is Member of the Advisory Board of the G-20Y
Association
- G-20Y Association could add value by providing an independent
perspective or “fresh look” into issues and areas of concern on the
international agenda
G-20Y Association Contacts
14 rue du Rhône CP 5670 1211 Genève 11, Suisse
+41-22- 518-16-31
[email protected]
www.g20ys.org
Shadow Banking: “The system of credit intermediation that involves
entities and activities outside the regular banking system”¹.
Examples of shadow banks include: finance companies, asset-backed commercial
paper (ABCP) conduits, limited-purpose finance companies, structured investment
vehicles, credit hedge funds, money market mutual funds, securities lenders, and
government-sponsored enterprises².
¹Shadow Banking: Strengthening Oversight and Regulation; Recommendations of the Financial Stability Board, October, 2011; ²Shadow
Banking, Zoltan Pozsar, Tobias Adrian, Adam Ashcraft, and Hayley Boesky Federal Reserve Bank of New York Staff Reports, no. 458 July
2010
Recommendations re: Shadow Banking
PARIS 2011 – Shadow Banking
CHAIR: Professor Holger Erchinger, Partner KPMG LLP New York, G-20Y Summit Advisory Board Member; USA
Ignor Simic, Daadois Villet Maillot Brochier (AARP), Partner; France
Ikuo Nakamura, ORIX Corporation, Vice President,
International Business Group, Global Business and
Alternative Investment Headquarters; Japan
Jacques Celliers, RistRand Bank, Chief Executive
Officer of FNB Credit Card, FNB Retail Foreign
Exchange and FNB Vehicle Finance Divisions;
South Africa
Joon-Hui Yoon, Hana Financial Group in South
Korea, Manager, Risk Management Team;
South Korea
John Flint, HSBC, Global Asset Management, CEO;
UK
Yousock Hong, Hana Bank, Manager, FX Dealer,
CFA;South Korea
Ann Kaplan, iFinance Canada, President & CEO;
Canada
C Level: Integrative think-tank – shared ideas
The shadow banking system is an important sector of a developed financial system,
facilitating capital formation and economic growth. Generally, the entities of the
shadow banking system have raised short-term financial instruments to finance longterm, illiquid and risky assets through multiple steps of credit intermediation
Disruptions in the credit markets have made them subject to rapid deleveraging,
selling their long-term assets at depressed prices.
Short
Long
Term
Term
•
Non depository: Not subject to the same
safety/soundness as depository banks
•
Borrower (form investors) short-term,
loan long-term
•
Subject to market risk and liquidity risk
(no access to central bank liquidity/
quarantees)¹
¹2011 KPMG LLP
While the financial crisis originated in 2007 in the US as a subprime crisis, it evolved into
a banking, sovereign debt, and ultimately political crisis of global scale. The recent
economic crisis can, at least partially, be linked to the vulnerability of the shadow
banking industry.
Figure 1. Traditional and Shadow Banking Systems
¹Federal Reserve Flow of Funds Report
Financial Stability Board Publishes Progress Report for its Shadow Banking Task Force
On September 1, the Financial Stability Board (“FSB”) published a progress report on the work
of its Shadow Banking Task Force (the “Task Force”) to develop a stronger oversight and
regulatory framework applicable to the “shadow banking system”.
Earlier in the year, the FSB published a “Background Note” on “Scoping the Issues” for
shadow banking. It identified four broad options for developing a regulatory response to
shadow banking entities and activities. In general, these options included:
Regulating the interaction of banking entities with shadow banking
entities.
Directly regulating shadow banking entities.
Regulating certain instruments, markets or activities to facilitate sound
credit intermediation.
Implementing macropudential measures to regulate the shadow
¹The Washington Report Newsletter – September 6, 2011
banking system more
broadly
We, the G-20Y Summit participants, support the notion that:
•
The shadow banking system is an important part of the global economy as long as
the benefits are derived from specialization and competitive advantage (and not
from regulatory arbitrage);
•
The financial system can only be effective if there is clarity as to where risk in the
system resides;
•
Once clarity has been achieved, it should be determined whether the capital that
ultimately supports credit creation is appropriately sourced;
•
Following on from the above, there is no need for regulation as long as the
underwriters and participants in those markets are the only bearers of that risk (no
backstop by the tax payer);
•
Regulation should be required only in instances where the risk and ultimate liability
may be transferred to the tax payer.
Recommendations from the G-20Y Summit – Paris, 2011
In regard to the regulation of shadow banks, we have agreed on the following four
recommendations:
•
Implement a policy of no governmental bailouts for activities outside the regulated
area. This means that underwriters have to understand that they bear the full risk
and must therefore identify and communicate those risks in the various
unregulated financial markets;
•
Base regulatory activities in the area where the tax payer is at risk on functions
rather than institutions;
•
Accelerate and implement reforms, in particular related to money market funds.
Specifically, clarify that the risk resides with investors, consider a substantive
change regarding the concept of ‘net asset value (NAV)’, and the introduction of
a liquidity redemption fee designed to remove the incentive to be the first out of
the fund;
•
Establish a voluntary compliance framework that would facilitate transparency and
foster the system in regard to the unregulated shadow banking system.
Recommendations from the G-20Y Summit – Paris, 2011
Global Financial Reforms – Banking Committee 2014
In the aftermath of the global financial crisis, G20 member States have
made considerable headway in global financial reforms aimed at
preventing a repeat of the financial crisis but the work appears to be
unfinished. The G20Y Global Financial Reforms – Banking Committee will
discuss:
•Priorities to complete banking-related financial reforms;
•How to prevent and manage the failure of globally important banks;
•Approaches to make derivatives markets safer.