As consumers become more conscious of their environmental and social impact, the sustainable finance retail market must evolve to meet these demands. However, questions remain about what is currently available to retail investors, what the existing gaps are, and how this market can further develop. Innovation can be key in supporting this evolution.
This month, we had the pleasure of interviewing Cathrine Foldberg Møller, Partner at Simmons & Simmons Luxembourg LLP and Chair of the LSFI Working Group on Innovation and Retail Products for Sustainable Finance. In our discussion, we explored the objectives of the recently launched LSFI working group on retail products and innovation for sustainable finance, the goals the members aim to achieve, and the challenges they face when assessing the market for sustainable finance products aimed at retail investors.
LSFI: Why is it relevant to have an expert group focusing on retail products and innovation for sustainable finance, and what’s the objective?
Cathrine Foldberg Møller (CFM): As a group we want to identify sustainable products available to retail investors and assess the potential for increase or development of such products. We will do this by looking at incentives and barriers. This aligns nicely with the EU’s Capital Markets Union and more recent Retail Investment Strategy to turn millions of European savers into investors.
LSFI: What role do retail investors play in advancing sustainable finance? 
CFM: With EU households collectively holding approximately €33.5 trillion in savings, as highlighted in the Draghi Report, they represent a significant untapped resource for driving sustainable investments. Additionally, their increasing interest in ethical and sustainable products is pushing financial institutions to innovate and expand ESG offerings, aligning with the goals of the European Green Deal.
LSFI: What are the most significant challenges in assessing the current offering of sustainable finance products for retail investors?
CFM: We have decided to look at the current offering in Luxembourg and beyond, particularly within the EU. The biggest challenge in gathering data is knowing where to look. We are lucky to have a working group made up of some of the most important players on the local market, e all eager to share their expertise. Many institutions will already have done due diligence for their own business models; our role will be to consolidate, compare and contrast this.
LSFI: What would a successful outcome of this working group look like?
CFM: Shedding light on the opportunities for retail investors in Luxembourg and the final report acting as a catalyst for increasing the options and availability of sustainable financial products.
