Luxembourg slipped two places in an international ranking of the quality and depth of green finance offerings in financial centres. Luxembourg ranked in 6th place, putting it in the top 15 green finance centres. The Grand Duchy is second in the EU in the ranking, behind Amsterdam, which came out ahead of Zurich, London, Oslo and San Francisco.
In the previous edition of the assessment, Luxembourg had ranked 4th.
7th edition
The latest ranking/rating was done in the 7th edition of the Global Green Finance Index (GGFI 7) published by commercial think-tank Z/Yen, published in April 2021.
The index includes a second measure of financial centres’ green finance offerings called its “rating”. This brings together a measure of the depth of the offering (how deeply green finance has penetrated the business of the financial centre) and its quality. Luxembourg’s rating in this measure dropped by 7 points.
Depth vs quality
The report evaluates Luxembourg’s green finance depth at 5th place, and its quality at 7th place.
Top-ranked Amsterdam was rated with a depth of 1 and quality of 3. Number 2-placed Zurich has a depth of 3 but a quality of 1.
The report noted that the quality results demonstrate that “leading centres must keep an eye on the quality of their offerings as the market for green financial products and services continues to expand rapidly.”
In the report’s commentary, it noted that while Western Europe continues to dominate the ranking, “its crown may be slipping as it faces stiff competition from both North America and the Asia/Pacific regions.”
Outperforms financial centre
Luxembourg’s green finance ranking is relatively higher than the Luxembourg financial centre’s overall placing (17th) in the Global Financial Centres Index (GFCI), which has measured such centres’ competitiveness since 2007.
The GGFI describes itself as a “factor assessment index, based on a range of instrumental factors - quantitative measures” as well as a worldwide survey of finance professionals’ assessments on the quality and depth of green finance offerings in financial centres.
The GGFI 7 evaluated 124 financial centres and included 78 in its index, up from 74 in the previous edition (those receiving at least 20 assessments from respondents filling in the online survey were included).
Read the report at: https://www.zyen.com/documents/2650/GGFI_7_Report_2021.04.29_v1.1.pdf