With Donald Trump returning to the White House and the installation of a new European Commission, the coming year is poised to bring significant change. To navigate these developments, our recent digital event, Focus on 2025, brought together distinguished speakers to illuminate the path ahead for investors and finance professionals.
Donald Trump’s upcoming second term as President of the United States has raised concerns in Europe, particularly regarding the threat of increased customs tariffs. Should this warning be taken seriously? Carl Tannenbaum, Chief Economist at Northern Trust, offered a measured perspective, noting that « we saw during Trump’s first term that not all threats are carried out. Often, reality is less extreme than what was announced. This is also what many analysts I’ve spoken with think. I would still like to warn them. It is indeed important to know that the Trump administration is counting on additional tariff revenues to fill budgetary gaps. »
Tannenbaum remains cautiously optimistic about transatlantic relations, highlighting shared interests between Europe and the United States, particularly in the realm of security. « The United States is going to be asking more of the Europeans to maybe push harder against China, which is the number one target of the trade sanctions that Washington is thinking of doing and one cannot create adversarial relations with your allies as you’re trying to address perhaps a common opponent. So perhaps I’m more hopeful than realistic, but I think the second time around might be a little bit more collaborative than Trump 1.0. »
Since the 2008 financial crisis, Europe’s financial sector has faced an exhaustive effort to comply with regulatory measures imposed by the EU. Will this trajectory persist under the new European Commission? Anke Klein, Managing Director of the Investment Company Institute’s Brussels office, suggests a shift may be on the horizon, « if you look at competitiveness and burden reduction being so high on the political agenda, it would actually be contradictory to further expand that regulatory rule book in the way it has been done in recent years. »
Klein further highlighted the anticipated Savings and Investment Union roadmap, expected in March 2025, as a promising long-term initiative, noting that « dynamic capital markets are essential to the European project. They allow for better returns and support long-term investments. But this is also a cultural change that will require time. So, the earlier we start, the easier the transition will be. »
Timothée Jaulin, Head of Responsible Investment Development and Advocacy at Amundi, provided an alternative perspective on the perceived slowdown in ESG investments over the past two years. « There has been a normalisation of fund flows, as we have reached an impressive level of ESG fund penetration compared to 5 or 10 years ago. There was a backlash, but limited to the United States. In the rest of the world, we observed a normalisation rather than a decline, with flows following a more linear trend than the exponential growth of recent years. »
Jaulin attributed the deceleration to the complexity of integrating ESG across the value chain and the challenge for investors in translating intent into action. Looking forward, he highlighted that « next year will be particularly interesting in the European context, with a new European Commission and a revision of regulations to simplify them. The SFDR process will be reviewed, which could make the regulatory system more practical and less complex. »
This simplification, as Jaulin emphasised, is a priority shared by many investors and one that must be addressed swiftly.
Watch the full replay here.