‘Sustainable funds’ continue to invest in fossil fuels
If you thought you were investing responsibly and sustainably for the future by pouring your savings into a “sustainable”, “climate” or “ESG” fund, you might have to think again.
Nearly half of such seemingly greener investment funds available to customers in Luxembourg invest in fossil fuel companies, an investigation by the Luxembourg Times and ten other European publications has found. The “Great Green Investment Investigation” is coordinated by Follow the Money and Investico.
Of the 509 funds available in Luxembourg containing the words “sustainable”, “climate” or “ESG” in their names, 231 had some exposure to fossil fuel companies, according to data obtained from financial information provider Morningstar. The total market value of these investments stood at €2.8 billion, that is 1.2% of the market value of their total investments, when the data was extracted on 31 January.
The situation is similar elsewhere in the European Union. Of the 1,277 funds that call themselves “sustainable” or use the terms “ESG” or “climate”, 43% had made at least some investments in fossil fuel companies. The total market value of these investments was €6.76 billion.
SES staff to stay stable after Intelsat takeover, CEO says
While there is no guarantee that all of the more than 600 Luxembourg jobs at SES will go untouched if it successfully merges operations with rival Intelsat, the employment level should stay intact for some time to come, the company’s top executive told the Luxembourg Times on Thursday.
While SES and Intelsat plotted out what their ultimate staffing levels could be in estimating how much combining the companies would save before their merger was announced Tuesday, defining specific roles in the integrated company will take months, Chief Executive Officer Adel Al-Saleh said.
“I don’t see a scenario where we’ll be dramatically reducing employment in Luxembourg. There will be some overlaps, no question, but I believe the 600-level of employees will persist for a period of time, for years to come,” he said in an interview at the company’s Betzdorf headquarters.
“The opportunity for us to create this larger company gives our employees the opportunity to be playing in a bigger company, with having careers that progress not only in a particular country, but actually across the globe. That’s something very important to keep in mind,” Al-Saleh said.
Where inflation and interest rates bite most
When prices started rising in the summer of 2021, central bankers widely believed inflation was transitory as the global economy was emerging from pandemic lockdowns. Fast-forward almost three years and Luxembourg has still not returned to the ECB’s target rate of 2% after hitting double-digit inflation in the autumn of 2022.
While large businesses and the country’s banks still made stonking profits last year, other sectors of the economy are languishing amid record-high interest rates. No industry’s ailments are better documented than those of the construction sector.
Rising interest rates squeezed household pockets and slowed down the property market. That caused construction works to slow to a crawl and led to some high-profile bankruptcies, such as Manuel Cardoso or Maçonlux, to name just two. The government stepped in earlier this year, pouring hundreds of millions of taxpayer money into fiscal incentives for private investments, state acquisitions of unsold housing units and partial unemployment aid. Changes to planning laws and environmental rules to speed up building are underway.
“We think that the measures the government has taken will have a positive effect, but we are not yet experiencing a recovery,” said Jean-Paul Scheuren, the head of the real estate lobby group Chambre immobilière.
Luxair starts training the pilots it needs to keep flying
Luxembourg’s national airline last month started paying the training costs for future pilots ahead of an expected talent shortage that threatens to retard its growth.
A new training effort that involves Luxair paying the heavy upfront costs to prepare cadets for the cockpit took off in April with an initial handful of students. Another group launching the 18-month training course is due to start early next year.
“This partnership arrives when the industry faces a critical shortage of pilots,” BAA Training CEO Marijus Ravoitis said in a press release. The Lithuanian company will conduct the lessons at a Spanish airport near Barcelona. “Luxair’s initiative to pre-finance the training of its pilots is a direct and innovative response to this escalating need for skilled aviators.”
Luxair’s pilot cadet programme pays for the training, which is to be repaid from their salary once graduates start flying for the airline. The cost of integrated flight training for airline-specific cadet programmes can be €140,000 or more per person, according to Flight Deck Friend, a UK-based group of pilots advising other aviators.
Such efforts are relatively uncommon but catching on, in part because the tailored training cuts the time required to get new pilots behind the flight controls, said Rory Heilakka, an aviation and transportation consultant at Oliver Wyman in New York.
Luxembourg workers put in fewer long hours last year
Fewer employees in Luxembourg worked long hours last year compared to the European average, with that number also having reduced in the last couple of years.
Data released by Eurostat on Wednesday showed that 6% of workers in Luxembourg worked more than 49 per week in 2023, above the 40-hour work week standard. The share was down from 7.7% in 2021.
The duration of the ideal working week has generated considerable debate in Luxembourg in recent times. When in power, the Luxembourg Socialist Workers’ Party (LSAP) had proposed reducing working hours.
Labour minister George Engel commissioned a study in 2022 to analyse the effects of reducing working hours. Two out of three employees in Luxembourg would prefer to work less, the study by the Luxembourg Institute of Socio-Economic Research (Liser) concluded. The broader impact of reduced working hours on business and on Luxembourg’s competitiveness would also need to be considered, however, researchers said.
