On January 27th, we brought together academics, labour unions and civil society to unpack the little-known investment practice economists call de-risking. This text provides a summary of the discussion, highlighting the actors involved, the interests behind this approach, and how this practice, which is increasingly shaping Europe’s economic agenda, impacts the struggles for climate action, quality job creation, public services and democratic decision-making that trade unions and civil society are engaged in.

   1. Explanatory Section: Angela Wigger

Our event “Profit Over People: How De-risking Is Shaping Europe’s Economic Agenda” opened with an explanatory panel led by Angela Wigger, focusing on clarifying what is meant by de-risking and how it currently operates as a financial strategy within the EU’s economic agenda. Angela Wigger began by stressing that de-risking refers to the use of financial instruments designed to absorb part of the risk from private investors with the goal to persuade them to invest in projects or activities that pursue policy goals.

She explained de-risking by focusing on the most prominent mechanism the EU uses to implement this strategy: InvestEU. At its core, InvestEU functions through a budget guarantee mechanism for the European Investment Bank and other European public financial institutions, aimed at reducing private investor risks to trigger more investment at a time when the propensity to invest has remained low since the 2008 financial crisis.

Although InvestEU is often portrayed as part of an EU industrial policy, Angela Wigger highlighted that it provides very little actual policy guidance. For example, only around 30% of the funds are allocated to green investment. While InvestEU is divided into different “windows” that appear to reflect policy priorities, these lack meaningful conditionalities. And in cases of bankruptcy, public money can, and will, be lost.

An inherent contradiction lies at the heart of the instrument. On the one hand, projects are deemed too risky and therefore in need of de-risking. On the other hand, it is claimed that the risks for the public sector are minimal. In reality, rather than reducing risk, this system often creates additional risks, as each actor in the investment chain introduces new layers of exposure. If parts of the investment fail, this can lead to increased debt. In other words, investments are considered too risky for private actors, but presented as low-risk when the public is expected to carry the burden.

From a decarbonisation perspective, Angela Wigger argued that this approach amounts to procrastination. Technocratic financial solutions will not deliver decarbonisation. Instead, de-risking contributes to increasing the power of the financial markets instead of steering the economy towards a green and just transformation, and reinforces a debt-led economic model in which continuous economic growth is required to service debt.

Finally, Angela Wigger highlighted the lack of Commission oversight and democratic control over these mechanisms. The European Parliament has very limited influence beyond the EU budget, leaving major investment decisions under programs such as InvestEU largely outside democratic scrutiny.

   2. Discussion Panel

The discussion panel examined whether de-risking can effectively support climate action, quality jobs and public services, or whether it mainly reinforces a financialised economic model. While some of the speakers argued that public support for the private sector can be important for developing clean technologies, even though they must come with social and environmental conditions which are currently lacking, others claimed that de-risking is largely ineffective. They argued that the private sector already holds far more capital and profits than the public money made available through de-risking, but that companies choose to distribute these resources to shareholders rather than invest in productive, socially useful or environmentally sustainable projects.

Nevertheless, speakers broadly agreed that, in its current form, de-risking is not delivering the promised outcomes. The main concern was that the approach prioritises financial leverage and short-term returns over productive investment and whether de-risking can address structural investment gaps without challenging the existing business model.

From the perspectives of trade unions and civil society, the panel highlighted that direct public investment and green public services deliver clearer social, economic and environmental benefits than de-risking, which absorbs public capacity without sufficient returns for workers or communities. The discussion underlined the need to use public money as a lever for systemic change so that public resources are directed towards the public good rather than short-term corporate profitability, which could be done by:

  • Strengthening state capacity,
  • Ensuring regulatory certainty,
  • Investing in green public services and

  • Ensuring that companies receiving public money actually need it and adopt a business model that focuses on reinvesting profits into sustainable productive activities and high quality jobs.

3. Breakout Groups: Reporting Back

The breakout groups discussed how de-risking could be challenged through alternative narratives, examples and political strategies. One group focused on ownership, questioning whether companies receiving EU public money should remain privately owned when profit expectations undermine the delivery of essential goods and services. Alternative ownership models, stronger regulation, taxation and the role of workers and trade unions were highlighted as key elements to enable changes in business models alongside public investment. Another group centred on housing affordability, stressing that EU financial mechanisms must prioritise those most in need, mobilise sufficient public funding for renovation, support land-based solutions, and recognise that market-based approaches cannot solve the financialisation of housing and land. A third group looked beyond the EU, discussing de-risking under the Global Gateway and in biodiversity-related investments, while also highlighting positive examples of public investment and the need for stronger narratives and joint positions to challenge de-risking and advance alternative public investment approaches.