Table of Contents

Part 1 – It’s decision time
Part 2 – It’s action time

Part two of our sustainable finance series

The market now recognizes a need to concretely measure and disclose the ESG impact of investments on the planet and to measure and manage the impact of ESG risks on investments.

As a result of this shift in mindset, sustainable finance will have an impact on the entire investment value chain, from portfolio allocation, to risk management, disclosures and ESG data management. Additionally, ESG considerations will eventually need to be integrated into each step of the life cycle of an investment product, from design to distribution.

Strong data quality, sound methodologies and efficient processes and controls: all three are essential when calculating and reporting on climate-related financial risks.

Julien Ganter
KPMG Luxembourg

Investment advisers will have to assess the sustainability preferences of their clients but also match these with relevant products that fulfill those preferences. Asset managers will try to quantify and demonstrate the impact of their investments and shift their portfolios to assets that contribute to the transition to a low carbon economy. Above all, clarity, transparency, comparability and reliability of ESG information must be taken as seriously as financial information by all financial market players. This is to ensure that sound, profitable and sustainable investment and lending decisions are made, in favor of the transition to a low carbon, sustainable economy.

In this report:

  • Finding your way through the terminologies
  • Measuring the impact of your investments
  • Translating ESG factors into monetary terms
  • Making the most of your investment product
  • Understanding climate-related financial risks
  • The ungraspable social and governance risks
  • Getting to know the disclosure requirements from financial market players

Next steps

Are you impacted by the issues touched upon in this report? Get in touch with Julien Ganter and his team to discuss your perspective or challenges. To read part one of this report, click here.