Luxembourg's Ministry of Finance has confirmed that, as of 28 January 2021, the Moody's credit rating agency has certified Luxembourg's good environmental, social and governance (ESG) performance, following the recent introduction of "ESG" aspects in its assessment methodology.
The agency mentioned that the Grand Duchy continues to benefit from the highest credit rating, "AAA", based in particular on a "robust financial situation of the State and a low level of debt, a far-sighted economic policy and a stable political environment".
In this updated opinion, the rating agency attributes a “positive ESG” credit impact score to the Grand Duchy, reflecting low exposure to environmental and social risks, top-performing governance as well as a very high capacity to respond to shocks. Moody’s stresses that thanks to its solid economic structure, Luxembourg was able to better resist the economic consequences of the pandemic.
The agency notes that Luxembourg's exposure to environmental risks remains low. For Moody’s, Luxembourg stands out with its particularly high performance in terms of safety and widespread and quality access to health care. In terms of governance, Luxembourg obtains the best possible score thanks to a high degree of transparency and a balanced budgetary policy. The agency also notes that, despite its small size, Luxembourg has an efficient public administration.
Pierre Gramegna, Minister of Finance, commented “In the current context of crisis, I am delighted to see that our country still enjoys the highest rating and that it is well positioned in terms of sustainability. This is explained, among other things, by a prudent fiscal policy geared to a high level of investment and an economic policy emphasizing inclusive and quality growth."
