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Fredrik Ekström
Senior VP - Head of Nasdaq Stockholm
European Fixed Income and ESG

23 August 2022

Could you provide a brief overview of your journey at Nasdaq?

I joined Nasdaq in 2010 as Chief Risk Officer for the Nordic Region, and since 2020, I am Head of Nasdaq Stockholm, and also responsible for our ESG efforts in Europe. At the same time, I occupy the Chairman position in Puro.Earth - an innovative marketplace for carbon removal, where Nasdaq owns the majority of assets since 2021.

How does Nasdaq help companies in terms of disclosure in this transitional period?

As an exchange operator, we are at the intersection of the market, acting as a bridge between companies and investors. Navigating the increasingly complex ESG environment that clients operate in is a central point in our strategy and we have pioneered many solutions that aim at supporting them in this journey. Nasdaq´s strategic approach towards sustainability is based on three main pillars: drive excellence, supporting clients in achieving their own ESG objectives, and advancing and advocating for marketplace solutions as a means to support the green transition. 

In 2017, we launched a European ESG disclosure guide for listed companies. This was followed by a global guide, in 2019. Since 2021, we offer access to Nasdaq Green Equity Designation, a solution that helps listed companies showcase their efforts within ESG and sustainability to investors. We also provide workflow tools to support companies in their ESG reporting.

In which ways has the market for sustainable bonds evolved and how do you see it growing over the next few years?

The world's first sustainable bond was issued by the World Bank in 2008 and, in 2015, we were inaugurating the very first market dedicated to them.

 

A financial market plays an important role in supporting both companies that have made a successful green transition and companies that are still in an incipient phase. The sustainable bond market supports this transition and encourages the latter category to push forward.

 

Last year there was an amazing breakthrough, with 30% of all corporate bonds issued and listed in the Nordics being sustainable bonds. I expect the sustainable bond market to continue to grow and play an instrumental role in the green transition. 

How did Covid-19, geopolitical shifts and supply chain challenges impact futures contracts and transactions?

Despite the high volatility prompted by all these crises, the market has been very active in the last two to three years. Even in uncertain situations, it is critical that the exchange market supports raising capital, especially for small and midsized companies. Stock exchanges need to be open and accessible for investors in order to help them manage their own risk portfolio. This continuous involvement is what keeps the wheels turning, creating a steady environment for the green transition to evolve without important hiccups. In 2021 and 2022 we have seen record volumes of transactions, which means that business has not only continued as per usual, but it surpassed all expectations.

What are the greatest challenges for the green transition process within markets, and how can they be mitigated?

Right now, climate change is the most critical challenge we face as a society, and the financial market is part of this society. In order to be able to meet the 1.5° target, we have to reduce emissions and remove carbon from the atmosphere. This is exactly what we aim to achieve through the investment made in Puro.Earth, which is a marketplace that allows companies to use verified carbon removal credits for the residual emissions they cannot reduce or avoid. Aside from the technical and financing side of this endeavor, we have established an external advisory board that consists of academic and industry experts, whose purpose is to support development of new methodologies around carbon removal. Our goal is to support all these new and innovative technologies as a means to push the green transition forward.

Do you have a final message for our international readership?

Companies develop sustainable strategies because it helps them secure long-term access to capital which is critical for operations and also attracting future talent. When it comes to investors, we have seen a lot of focus on finding sustainable and verified green products to invest in. As a result of that and the overall climate challenge, many startups are coming up with innovative solutions for climate change and are keen on developing technologies that could have a great impact if scaled up. The green transition era will create many opportunities, but there is an important task we all have: to support this change with the help of technology and innovation, which are vital for the final success of this ambitious plan.

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