European financial ecosystems - EQUITA-Bocconi 2025 Research

Now that Europe is committed to strengthening and developing its Capital Markets Union (CMU) and the Savings and Investments Union (SIU), each state is required to rethink its industrial policies and the role of financial ecosystems in the development of the public good.

The paper (“European Financial Ecosystems: Comparing France, Sweden, UK and Italy”) examines and compares the French dirigiste system, the Swedish social democratic system, the British liberal system, and the Italian bank-centric system. The aim of the study is to illustrate how each of these countries integrates best practices on legislation and regulation, taxation, investors, and financial intermediaries, which are all necessary conditions to develop an efficient financial ecosystem.

Research suggests some concrete actions. First of all, the encouragement of household investment in equities through dedicated financial tools. Sweden’s ISK accounts, France’s PEA and PEA-PME plans, and the UK’s ISA prove that well-designed tax incentives can drive long-term market participation. Moreover, institutional investors and state-backed financial institutions can play a decisive role in stabilising markets and channelling capital efficiently. For instance, France’s Caisse des Dépôts et Consignations (CDC), which manages €1.1 trillion, has been instrumental in supporting strategic investments and its subsidiary CDC Croissance, which specialises in SME and mid-cap financing, stepping in where private capital is hesitant. Pension funds are another critical source of long-term capital, as demonstrated by Sweden and the UK. Sweden’s pension system, which combines state-backed AP funds with private occupational schemes, ensures broad capital market participation. The UK, on the other hand, is now consolidating 86 local government pension schemes into eight “megafunds” of over £50 billion each, a strategy designed to unlock £80 billion for investment in infrastructure and businesses.

Italy should emulate successful ecosystems like the French, the Swedish and the UK ones, by working on concrete and impactful actions, independently from the expected outcomes of the ongoing European initiatives, also considering the fragility of our capital markets and the urgency needed to revamp our market.