Rebrands ESG as “Energy, Security and Geostrategy” to align capital markets with Europe’s strategic autonomy goals.
Launches new thematic indices tracking defence, energy, and critical infrastructure to increase investor access.
Overhauls ESG index methodology to ease defence sector participation while maintaining alignment with EU regulations.
Euronext is leading a strategic shift in European capital markets by redefining ESG—traditionally known as Environmental, Social, and Governance—as Energy, Security, and Geostrategy. The move aims to channel investment into sectors critical to Europe’s autonomy and resilience, particularly defence, energy, and infrastructure.
“Since 2022, and even more in recent months, we have witnessed the emergence of a new geopolitical order centred around three key notions, forming a New ESG: Energy, Security, Geostrategy,” said Stéphane Boujnah, CEO and Chairman of the Managing Board of Euronext.
Supporting European Sovereignty
Euronext’s announcement includes tailored financing tools, new bond listing efficiencies, and a revamped approach to ESG indices. This initiative comes amid growing pressure from EU leadership to scale up defence readiness and reduce dependence on U.S. arms.
“European aerospace and defence companies have expressed the urgent need to invest heavily in their innovation and production capacities to guarantee Europe’s strategic autonomy for the next decade,” Euronext said in a statement.
Among its offerings, Euronext will launch a series of flagship thematic indices:
The European Energy Security Index, spotlighting conventional, nuclear, renewable, and critical energy infrastructure firms.
The European Aerospace & Defence Index, focused on innovators in defence technologies and advanced manufacturing.
The European Strategic Autonomy Index, targeting companies advancing resilience in energy, defence, tech, and infrastructure.
These indices are already being used as reference benchmarks for investment products developed with banks and asset managers.
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Regulatory Alignment and Index Revisions
As part of its index overhaul, Euronext will revise methodologies for its major ESG indices (CAC 40 ESG® and MIB ESG®) by June 2025. Under the new criteria, defence sector exclusions will be limited strictly to companies involved in armaments banned under international treaties, aligning with ESMA’s updated guidance on ESG fund naming conventions.
“Euronext will encourage ESG rating agencies to restrict the concept of controversial weapons only to armament activities prohibited by relevant international treaties,” the company stated.
Accelerated Access to Capital
To support defence firms further, Euronext will launch its IPOready Defence programme in Q3 2025—backed by EU funding—to streamline public listings and connect firms with investors and networks.
Euronext is also shortening bond listing timelines for defence firms to just two days, according to Boujnah.
Despite analyst skepticism on market appetite, defence players are watching closely. Thyssenkrupp, which is spinning off its naval unit TKMS, noted it would evaluate the program’s relevance.
“The geopolitical situation requires decisive action to strengthen military readiness and defense capabilities in Germany and Europe,” Thyssenkrupp said.
Broader Market Context
The push reflects a broader EU commitment: President Ursula von der Leyen confirmed in March that the EU could mobilize up to €800 billion to modernize the region’s defence industrial base.
As European asset managers face mounting pressure to revisit restrictions on defence investments, Euronext is positioning itself at the nexus of capital and strategic policy.
“Investors are becoming more eager to increase their exposure to the growing opportunities related to the ongoing investments in aerospace, defence, energy and strategic infrastructure in Europe,” Boujnah added.
This redefinition of ESG signals a turning point in aligning financial markets with Europe’s evolving geopolitical and economic priorities.
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