KPMG

Substantial governance-reform targets have been set for banks and investment firms by the CSSF. Some quick changes are required, but otherwise the regulator’s circular letter 20/759 seeks to drive long-term culture change on boards of directors regarding risk, diversity, and sustainability.

Assets under management of Luxembourg-domiciled private debt funds have risen by 36% to €108 billion in 2020, according to the KPMG/ALFI Private Debt Fund Survey 2020. Investment Officer discussed the dynamics behind the popularity of the asset class with KPMG’s Valeria Merkel and Julien Bieber.

Arendt Services

Benjamin Collette has been appointed new CEO of the business, accountancy and tax services department of Luxembourg-based law firm Arendt & Medernach. He specialises in strategy, regulatory and corporate finance.

The potential shape of the upcoming reform of the Alternative Investment Fund Managers Directive (AIFMD) became clearer this summer. The 18 August letter from Esma to the European Commission gave some strong hints on the outlook for this key text for Luxembourg’s fund industry.

While slowly getting back to normal, the priority of the country’s fund industry should be to review their operating models and reassess their risk, KPMG partners Ravi Beegun (pictured) and Alan Picone suggest. Meanwhile, asset managers should focus on cutting costs in response to the drop in revenues caused by the recession.

Sustainability fraud is on the radar of few investors and asset managers, but it is potentially much more harmful. The introduction of the EU green taxonomy will only serve as a further incentive for companies to misrepresent their sustainability performance.

“Green fraud”, also known as sustainability fraud, is a deliberate misrepresentation of sustainability data, usually taking the form of incorrect reporting in order to obtain higher ratings/rankings resulting in a better reputation, and thus a higher share price.