Sustainable finance
Luxembourg was the first European country and first AAA-rated country worldwide to launch its sustainability bond framework (the “Framework”), on September 2, 2020.
Based on this Framework, Luxembourg was the first European country and the first AAA-rated country in the world to launch a sustainability bond on September 7, 2020. This €1.5 billion issuance was used to finance or refinance investments with significant environmental and social impact across several priority sectors. The implementation of the framework has led to the regular publication of allocation and impact reports, the third and most recent of which—published in September 2023—confirmed that the proceeds from the issuance were fully allocated to green and social projects in accordance with the commitments made.
To take into account regulatory changes, lessons learned from this first sustainable sovereign issuance, and the most recent international standards, the framework has been revised and updated in 2026.
This update represents a substantial evolution from the initial 2020 framework and is based on a comprehensive review of Luxembourg’s political, economic, and climate context, as well as a significant strengthening of alignment with the European Taxonomy and the most recent standards of the International Capital Market Association (ICMA).
The new framework also introduces a new investment category dedicated to climate change adaptation, enabling the financing of projects aimed at strengthening the country’s resilience to growing climate risks.
This new version, approved by the Government Council on October 2, 2026, further strengthens Luxembourg’s alignment with international best practices in sustainable finance.
The updated framework thus builds on the successes achieved since 2020 while preparing the Grand Duchy for future sustainable issuances in a constantly evolving regulatory and market environment.
The framework’s alignment was independently assessed by Sustainable Fitch, a leading rating agency specializing in sustainable finance.
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