What are the various aspects of responsible banking and what are the challenges faced by banks? In this interview, Aude Payan and Elena Fuzzi, respectively Director and Senior Manager in Risk Consulting and in charge of ESG services for credit institutions at KPMG provide detailed insight and examples for innovative strategies for financial institutions to advance ethical banking standards.
ESG in the changing landscape of higher education
Global warming is a challenge that concerns us all and the economic system plays an important role in the battle against climate change. Thus, the University of Luxembourg has recently added sustainable finance into its higher education programs. We spoke to Katalin Ligeti, Dean of the Faculty of Law, Economics and Finance at University of Luxembourg.
1. Why has the University of Luxembourg included ESG in its higher education program? And how?
The Luxembourg Government has developed a very ambitious strategy to achieve the 17 Sustainable Development Goals adopted by the United Nations. Climate action and the commitment to keeping the global temperature rise well below 2°C above pre-industrial levels are among the most prominent goals which led to the Paris agreement. Sustainable Finance is expected to contribute toward achieving these goals by shifting financial flows from harmful, “brown” investments to sustainable “green” investments, which will help build a “better” world. This is why the University has launched an ambitious research and education project in Sustainable Finance within the framework of the Chair in Sustainable Finance, funded partly by the Ministry of Finance and the Ministry of Environment, Climate and Sustainable Development.
With high-quality, fundamental research, we aim at better understanding the impact of ESG challenges on capital markets, financial institutions and economic systems overall. On the educational side, we are building teaching programs to spread knowledge in sustainable finance and produce graduates that have skills that are actively sought after by the financial industry in Luxembourg. For example, the Department of Finance of the Faculty of Law, Economics and Finance launched a new Master specialisation in Sustainable Finance within the Master of Science in Finance and Economics during the 2020-2021 academic year.
2. Can graduates of any of Bachelor’s program choose to start a Sustainable Finance Master program?
The selection of the students for the specialisation in Sustainable Finance is done by the Study Director of the program based on the personal application file of the student. As demand is high and space is limited, in general, candidates need to demonstrate a solid background in Finance.
3. What types of jobs can students envision completing their degree program?
Students may apply for jobs in the financial industry in Luxembourg and abroad. Banks, asset managers but also insurance companies are desperately searching for experts in Sustainable Finance. Through a compulsory internship and the writing of an applied Master thesis in the fourth semester, the University assists the students in complementing their academic education with relevant professional experience.
4. Do you have any educational offer in Sustainable Finance for established industry practitioners?
Promoting advanced and academically-founded knowledge in Sustainable Finance and ESG is very important for the financial industry. During eight days of intense learning, practitioners can take a deep dive into all aspects related to Sustainable Finance, including regulatory aspects, issues in ESG-related reporting and disclosure standards. The first edition of the certificate took place in May 2021, with the next two sessions planned for January and May 2022. More detailed information on the courses and application procedures can be found on our website.
Five tips for future ESG students
1. Complete your first, common year of the Master program with high grades and comprehensively study the financial foundations.
2. Build interdisciplinary competences in ESG.
3. The Sustainable Finance ecosystem in Luxembourg is a small but fast-growing community. Go to events, network and tap your professors and teachers for mentoring opportunities!
4. Be aware of the pitfalls of green-washing.
5. Do not only talk the talk, walk the walk!
About the blog:
There is an urgent need for rapid transition to Global Environmental Sustainability. Thanks to changemakers, progress is possible. "Why does it matter?" is a bi-monthly series that takes a quick look at the forefront of today's trends around sustainability. From May 2021 on, we aim to elucidate this important topic through the eyes of our experts.
Your contribution counts too! From June on, don't miss out our experts' practical tips for your daily life.