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Key Trends for Regulated Businesses – Luxembourg Edition

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Key Trends for Regulated Businesses – Luxembourg Edition

​We’re delving into the Luxembourg market for our latest edition of the Key Trends for Regulated Businesses series – read on to find out more about the opportunities and challenges facing Luxembourg’s versatile, dynamic business landscape.

1. ESG (Environment, Social, Governance) Integration in Banking

A European leader in ESG-related assets (and an epicentre of fund investment activity), Luxembourg’s banking sector is famed for its progressive outlook, stability and resilience.

For example, the esteemed LuxFLAG, The Luxembourg Finance Labelling agency, has been supporting sustainable finance since 2006, issuing sustainability labels to over 300 financial institutions worldwide.

Luxembourg is also home to the world’s first Green Stock Exchange. Founded in 2016, the success of the Luxembourg Green Exchange (LGX) is a testament to the nation’s innovation-led investment industry.

As sustainable banking concerns rise, ESG integration is becoming a major point of contention for some decision-makers. Here at Broadgate, we’re seeing many ESG-focused roles emerge across Luxembourg’s financial services space, particularly in fund administration, investment banking, Risk and Compliance. Take a look at our latest live roles for more insight: Jobs.

As we’ve had the privilege of working with plenty of ESG-minded financial institutions across Luxembourg and beyond, our team is equipped with the specialist market knowledge needed to connect candidates in this emerging area. Interested in getting a head start in Luxembourg’s forward-thinking finance world? Contact our recruiters here:

2. Skill Gaps

A recent study reported in the Luxembourg Times found that around 46% of workers were considering moving to a new role in 2024, with 58% feeling confident in the job market. With its ongoing talent shortages and diverse cross-section of tech and finance hubs, Luxembourg indeed presents an opportunity-rich landscape for top talent, although skill sets are struggling to evolve at the rate of industry transformation.

This is leading to skill gaps in crucial growth areas, and while Luxembourg isn’t suffering from this challenge as much as other locales (Switzerland, for example), imbalances are still incredibly high. Given Luxembourg’s heavy reliance on foreign talent (82% of the finance and insurance workforce is made of residents with non-Luxembourgish nationality), the rising cost-of-living and complex visa systems skills broaden these skill gaps.

Alternative recruitment methods are proving to be essential. Contact us to find out more about how we plug skill gaps and future-proof your talent pipeline through our community-led approach to recruitment:

3. Tax Reforms

Luxembourg’s favourable corporate tax landscape is feeling the pressure of mounting regulatory complexity. As a result, the compliance burden is weighing heavily on regulated businesses. Whether that’s the Pillar Two Directive, the eighth version of the DAC, or the Unshell Proposal, the rate and scale of regulatory change have increased significantly in the last few years.

Often, the extent of the EU’s directives isn’t fully understood by local lawmakers, and the lack of clarity filters down to the transposition process, leaving businesses unequipped to remain compliant. This is reflected in the growing demand for compliance professionals we’ve seen in recent years, contributing to the fierce competitiveness of today’s talent market.

Whether you’re hoping to build a new compliance function from the ground up, identify your next CFO, or secure a growth-enabled career of your own, our specialist consultants are here to help. Contact the team to find out more about our diversity-focussed recruitment services in Luxembourg: Here.