Luxembourg’s Minister of Finance, Gilles Roth, underscored that ESG remains a “strategic and moral imperative,” not a passing trend. Echoing this sentiment, European Investment Bank President Nadia Calviño reaffirmed the EIB’s leadership: over half of the bank’s financing supports climate goals, and its climate roadmap will expand further this year.
Despite political backlash and declining public ESG commitments, particularly outside Europe, data from New Financial’s ESG report, presented by William Wright, offered a thorough reality-check. ESG-labelled financial activity has grown since 2022, even though market penetration has plateaued and implementation on the ground remains limited. Notably, for every dollar raised by “green” companies, over five flow to high-emitting ones. Wright called for a strategic reset: clearer regulation, realistic trade-offs, and stronger integration of private markets.
The Forum also spotlighted the EU Green Deal. While €250 billion in taxonomy-aligned investment was recorded in 2023, it falls short of the financing needed to meet EU climate goals. Participants emphasised the need to build more investable opportunities in the real economy rather than relying solely on expanding regulatory frameworks.
Transition finance was highlighted as a key mechanism for decarbonising high-emission sectors such as steel and transport. Experts shared methodologies for evaluating client progress along credible net-zero pathways, emphasising science-based targets and long-term engagement.
Another milestone came from Slovenia, which became the first EU member state to issue a sovereign sustainability-linked bond (SLB). With innovative step-up/step-down coupons tied to emissions targets, the SLB exemplifies credible, transparent sovereign ESG instruments.
A dedicated session on blue finance spotlighted how funding models are maturing and the blue economy is gaining traction as a vital lever for climate and biodiversity resilience.
Finally, the Forum’s updated edition addressed ESG regulation, product labelling, and ratings. The debate focused on SFDR’s Articles 8 and 9, the pros and cons of product categories, the need for transparency, and the limits of ESG compatibility – particularly regarding certain calls for defense investments.
For more information on Luxembourg’s sustainable finance ecosystem click here, and to watch the full replay click here.