Digital Finance Summit 2022 https://www.digitalfinancesummit.com/

1. FINTECH AS AN ENABLER OF LUXEMBOURG’S
SUSTAINABLE FINANCE STRATEGY
October 2022

2. OUR STUDY
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✔ EU Action Plan is driving financial sector to take action
✔ Sustainable finance is a strategic pillar of Luxembourg’s financial
sector, particularly in relation to investment funds
✔ ESG data and reporting have become critical to meet regulatory
requirements
✔ Confusion reigns on what needs to be done and the costs and
risks associated with action
✔ Understand the challenges and opportunities faced by
financial institutions
✔ Understand the current status quo of Fintech in relation to
ESG
✔ Analyse opportunities for Fintech in ESG
✔ Present practical actions to drive impact
CONTEXT
HOW CAN FINTECH FIRMS HELP TO DRIVE CHANGE
AND ACHIEVE SUSTAINABILITY GOALS?
OBJECTIVES
Report publication: December 2022

3. WHY?
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Banks
FinTechs
Government
Researchers
52 %
15 %
7 %
4 %
Associations
22 %
F2F interviews with key players in Luxembourg
spanning multiple sectors:
✔ 120+ Banks from 26 countries
✔ AAA Rating from Standard and Poors, Fitch and
DBRS
✔ 7 of the world’s 52 Tier IV data centres
✔ No. 1 Fund Centre in Europe, No. 2 in the world
- €5.9 Trillion AuM ($6.3 Trillion)
✔ 250+ Insurance companies
✔ 37,000+ listed securities, € 8 Trillion + Assets
held in custody
✔ 1st
in the world for Green Bonds
✔ 21.2% market share in ESG fund assets
✔ 1st
in EU for microfinance - 50% of funds

4. Sustainability is a priority Financial institutions (Fis) have an important role to play to achieve our mutual goals
Luxembourg enjoys a rich FinTech and
sustainable finance environment
Broad and deep ecosystem: The LHoFT, Luxembourg Sustainable Finance Initiative (LSFI), The International Climate Finance
Accelerator (ICFA), The Luxembourg Stock Exchange and Luxembourg Green Exchange (LGX), Luxembourg Finance Labelling
Agency (LuxFLAG), The European Investment Bank (EIB).
Growth of Luxembourg’s Fintech
sector’s ESG offerings
FinTechs attracted by multicultural and dynamic market as well as broad and easily accessible industry. FIs are engaged with
and recognize the benefit of working with FinTechs to tackle complexities of sustainable finance
Availability and management of ESG
data is a major barrier
Data is the main area of focus of ESG FinTechs and FIs. FinTechs can support with data collection, integration and
consolidation, as well as quality assurance and report production.
Education and expertise are required
in order to achieve goals
a) the novelty of sustainable finance and b) the relentless schedule of regulatory changes, drive a desperate need for
education and talent
Uncertain regulatory landscape Not a show-stopper for sustainable finance solutions and Fintechs, but an opportunity
Collaborative, multi-stakeholder and
cross-sectorial approach
Collaboration is a must for ensuring fast, agile and effective change and impact
Regulator and government initiatives Incentives can be developed to drive rapid growth in the sector
SOME KEY FINDINGS
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5. CHALLENGES
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Consistent translation of sustainable finance
regulations
Facilitation of an exchange of education,
information and expertise
Technical infrastructure upgrade, to facilitate
new ESG Fintech offerings
Openness to intersectoral and cross-sectoral
collaboration
ESG is an opportunity, not a risk
Walking the talk – real action

6. CALL TO ACTION
A national strategy around sustainability
and (financial) technology
Going beyond sustainable finance regulations
Building organizations with a purpose
Targeted fiscal incentives
Turning FinTech attributes into a
national asset
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7. Thank you!
Nasir Zubairi
CEO – The LHoFT Foundation
@naszub