Luxembourg and the Global Quest for Gender Equality

The Sustainable Development Goals will never be achieved without closing the gender equality gap. Progress towards this was painfully slow before the start of the COVID-19 pandemic. Much of even that progress has since been reversed. War and climate change are making matters worse. Yet women, in all their diversity, are a critical part of the missing solution to these compounding global crises. What needs to be done to fix the problem? And what role can a country like Luxembourg play, especially given its expertise in international finance? 

The first step is to learn and apply the lessons from COVID-19, which particularly affected women’s incomes, health and safety. Lockdowns and curfews significantly reduced their employment in the part-time, informal, service-oriented jobs on which so many women relied. The pandemic interrupted gynecological and reproductive care and intensified all forms of gender-based violence. Some statistics are especially striking indicators of the pandemic’s deep and long-term impact on lives and futures. Eleven million girls have dropped out of school and may never be able to return. That female human capital will be lost forever1 . Today, thirteen million fewer women are in employment. While they lost their paid jobs, women did more unpaid work, as they became care providers for their home-bound children and their sick elders.2 Those prolonged periods of reduced working hours or temporary career breaks will soon show their impact in lower pension wealth and higher incidence of female poverty in old age3.

Government responses to the pandemic were swift and significant—in the trillions of dollars. But those responses were mostly gender blind. Out of more than 3,000 social and labour-market measures taken, only 12 per cent targeted the needs of women. The result has been a slower and more costly recovery for all. So the first lesson is this: put all public policy through a gender lens. When making decisions, have women in mind and in the room.

The second, humbling lesson has been learned in the past few years: governments cannot fix the gender discrimination problem on their own. Their funds, even when available, will not suffice. Nor will top-down reforms. We need to harness the power of markets. Solutions can only be found if we align the incentives of governments and corporations, politicians and investors, public and private sectors.

Luxembourg’s experience is important here, having played an important role in putting private finance in service of the environment. Its Luxembourg Green Exchange, created in 2016, is the world’s first platform dedicated to sustainable securities. By the end of 2021, the Exchange listed more than a thousand “green, social, sustainability, and sustainability-linked” bonds, worth some 600 billion euros.4 New issuances are coming to the market at astonishing speed. Last year, they topped one trillion dollars globally. Never before has so much money converged so fast towards a public good — like a stable climate.

The success of green bonds can extend to gender bonds. Luxembourg is already a front-runner in advancing new financial instruments. It could also be a front-runner in creating the financial ecosystem to advance gender equality, through the issuance of securities whose proceeds empower women and girls. A new set of standards for gender investing that supports the use of sustainable debt for gender equality has recently been published by the International Capital Markets Association, the International Finance Corporation of the World Bank and UN Women.

Less than one per cent of all thematic bonds have gender as their theme5 . All of that one per cent has been issued by corporates. No government has ever issued a gender bond, even though many of them have been active in the green space. Achieving gender equality is the right incentive to change that situation.

The Government of Luxembourg intends to seize this strategic moment. It has launched a threeyear partnership with UN Women to catalyse global capital markets, leverage public-private initiatives, and design new financial instruments. A similar partnership with the Luxembourg Stock Exchange was agreed last May. The ultimate aim is to bring quantity and quality to the financing of gender equality and to mobilize capital flows that meaningfully contribute to the United Nations Sustainable Development Goals (SDGs), and in particular SDG 5. Women and girls everywhere will benefit from it.

The pandemic may have stalled women’s progress towards equal rights, but it has also showed us the way forward. Critical in this progress is the alignment of gender-sensitive policy and sustainable financing to achieve the SDGs. Governments and private investors can and should work with each other in partnership towards this goal. Only then can we accelerate towards making gender equality a reality. 


1UNESCO. 2020. “Addressing the gender dimensions of COVID-related school closures.”

2ILO. 2021. “Building Forward Fairer: Women’s rights to work and at work at the core of the COVID-19 recovery.”

3Athina Vlachantoni. 2019. “Socio-economic inequalities in later life: the role of gender.”

4Luxembourg Stock Exchange. (2022). A year in review - LGX. Retrieved July 4, 2022, from 


Joint article by Franz Fayot, Minister for Development Cooperation and Humanitarian Affairs and Sima Bahous, Executive Director of UN Women

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