Luxembourg Stock Exchange: An academy for sustainable finance education

By: Paul Chahine, Sustainability Research Manager and LGX Academy Lecturer, Luxembourg Stock Exchange Sep 2020

In the 12 months that have passed since World Investor Week 2019, the world has changed immeasurably. The effects of the COVID-19 pandemic has caused the world to rethink its actions and habits in order to build back better and ensure a green and sustainable recovery from the crisis. However, this shift into a more sustainable direction requires knowledge and insights into sustainable finance practices, and this need is not fully met today.

In May, early on in this global pandemic, the Luxembourg Stock Exchange (LuxSE) officially established the LGX Academy. The overarching goal of this initiative is to fill the gap in current sustainable finance education in Luxembourg and beyond, and thereby contribute to accelerating the sustainable finance agenda. World Investor Week 2020 comes at a very special time for the LGX Academy as it enters into its first full virtual course cycle.

Making every room a classroom

About a year ago, when we first started offering courses on  sustainable finance, the LGX team of sustainable finance experts offered tailor-made, face-to-face courses for a range of practitioners in the finance sphere. When the Covid-19 pandemic hit, we needed to adapt our approach to respect the social distancing rules. The result is that instead of starting the autumn term in a physical classroom or lecture hall as planned, our first, full cycle of seminars will take place in the online space.

On September 21, we will kick off the first wave of courses with around 25 professional participants from different backgrounds – from Luxembourg and abroad – preparing to immerse themselves in the teaching of our internal and external lecturers, all recognised experts in sustainable finance. Since its launch, the LGX Academy has attracted the interest of many entities and players in the market who wish to increase their knowledge – or that of their teams – in this field.

Comprehensive courses 

While our tailor-made courses respond to the individual needs of each client, ranging from private banks to asset managers and investment funds, the core offering of the LGX Academy is built around three carefully constructed courses:

1. The Fundamentals of Sustainable Finance module is the initial session, where participants are introduced to the concepts at the heart of sustainable finance, its historical origins and rapid development.

2. Products and Standards, our second module, allows participants to progress towards a deeper understanding of sustainable finance with a specific emphasis on green, social and sustainability (GSS) bonds. Here, participants gain an in-depth understanding of the products currently available on the sustainable finance market with a specific focus on GSS bonds as flagship products that have led the way towards further innovation. The course also covers in detail the internationally recognised standards and guidelines that serve as references in the market today.

3. Closing out our current offering, our Players and Regulations course turns its focus to the different sustainable finance taxonomies available on the market, with a specific emphasis on the role of external reviewers in the GSS bonds market. This module also covers relevant regulations and current market practices.

Building strong partnerships

To increase the scope and reach of our sustainable finance courses, we have established several strong partnerships with key players and institutions. These partnerships have allowed us to foster unity and avoid fragmentation in the area of sustainable finance education as it continues to grow. One fruitful example of such a partnership is our collaboration with the University of Luxembourg.

More than 40 masters students from the University of Luxembourg, spanning two separate master degree programmes – MSc in Wealth Management and MSc in Finance – have already benefitted from the LGX Academy’s curriculum and expert lecturers. Through these extensive lessons, the LGX Academy took its first step towards achieving its goal of shaping the views, knowledge and behaviour of the world’s future financial professionals.

We have also found other strong partners in the Luxembourg ecosystem, where the interest in sustainable finance is strong. We have entered into a partnership with the Luxembourg House of Training, which includes advanced lectures and workshops on sustainable finance, together with other players in the Luxembourg market.

We are also actively building partnerships for sustainable finance education on the international scene. Our partnership with the International Finance Corporation (IFC) is an excellent example of this. This has taken more than one form through courses delivered during the Green Bonds and Sustainable Finance Executive Programme hosted by the Stockholm School of Economics. This executive programme was designed in collaboration with ICMA and is tailored to emerging markets financial institutions that aim to issue green bonds with further sessions already in the works.

Additional insights

Through the courses and the partnerships already established by the LGX Academy, our lecturers share their knowledge, experience and in-depth market insights on a broad range of topics linked to sustainable finance. This means that participants are equipped with the knowledge they need to be an active player in the industry, advise their clients on sustainable instruments and contribute to the sustainable finance agenda.

The success of sustainable finance will not happen without proactivity, just as education and financial literacy does not happen without study. By making available an in-depth glossary and a resource section with relevant reports on its dedicated website, the LGX Academy helps those interested in the field to get an initial overview of the terminology and the basic concepts.

At the Luxembourg Stock Exchange, we are convinced that finance will be sustainable by default – so if you have not yet dived into the world of sustainable finance, this may be the right time to start.