Going global, green and digital: Luxembourg financial delegation visits Stockholm
Luxembourg Finance Minister Pierre Gramegna was in Stockholm with a delegation of professionals of the financial sector on the occasion of a seminar organised by Luxembourg for Finance.
The seminar focused on the role of European financial centres in the global fight against climate change as well as the challenges and opportunities for financial services, ranging from asset management and private equity to wealth management and life insurance, in an increasingly globalised and digital world.
In his keynote speech, Minister Gramegna insisted on the fact that Europe is back, both politically and economically, and that the EU is on the right path to sustainable growth. The Minister also stressed the need to de-dramatise Brexit: the EU has built bridges with London over many decades and the EU will still have bridges tomorrow. In the area of financial services in particular, Luxembourg has been a strong bridge-builder, a fact that is underlined by the increasing number of UK-based financial institutions choosing to relocate certain activities to Luxembourg or strengthen their existing presence to ensure continued access to the EU Single Market.
Minister Gramegna also reminded the audience of the long-standing ties uniting the financial centers of Luxembourg and Sweden, as illustrated by the presence of Swedish financial institutions in the Grand Duchy, dating back to the 1970s. Today there are seven Swedish banks in Luxembourg, including the four largest. Many of these financial institutions today use Luxembourg as their competence centre and hub to set up and distribute investment funds on a cross-border basis, provide tailor-made solutions to their international clients with multi-jurisdictional needs and benefit from Luxembourg’s expertise as a leading wealth management centre in Europe. 64% of foreign funds distributed in Sweden are Luxembourg domiciled funds, which makes the Grand-Duchy the most important domicile for Swedish cross-border funds. Growth is also strong in private equity and alternative fund sectors. More recently, EQT Partners, Sweden’s leading private equity firm, has decided to use Luxembourg as its EU fund management hub, with all future funds being domiciled onshore in the Grand Duchy.
Sweden and Luxembourg are both committed to play a key role in the fight against global warming. During the seminar, representatives from the EIB, the Luxembourg Stock Exchange as well as the Luxembourg and Swedish asset management community discussed the role of the financial industry in addressing the need for investments to mitigate and adapt to climate change and the various financial products, such as layered funds and green securities, which can be leveraged to channel private and public investments into climate projects.
Sweden has been a pioneer in socially responsible investments, and Luxembourg has long offered an ideal platform to launch ESG products.
Several pioneering initiatives underlineLuxembourg’s strong commitment to the fight against climate change:
- The launch of a joint climate finance platform between the European Investment Bank and the Luxembourg government;
- The recently launched Luxembourg Green Exchange is the world’s first platform exclusively dedicated to green securities and requiring pre- and post-listing reporting on proceeds;
- The Luxembourg Stock Exchange is the premier venue for Green bond listings in the world;
- The launch of the LuxFLAG Climate Finance Label granted to eligible investment funds financing climate change mitigation and/or adaptation measures.
Finally, the seminar explored the latest regulatory and market trends in the European investment fund industry and provided an overview of how Luxembourg can help Swedish private equity firms serve their European and international clients. Experts also discussed how the wealth management industry is adapting to a new and changing digital world as well as the role of life insurance as an increasingly popular wealth management and succession planning tool, notably in Scandinavian markets.