07.23.2020

Assets In ESG ETFs Reach Record

ETFGI, a leading independent research and consultancy firm covering trends in the global ETFs/ETPs ecosystem, reported today that ESG (Environmental, Social, and Governance) ETFs and ETPs listed globally gathered net inflows of US$3.49 billion during June, bringing year-to-date net inflows to US$32.02 billion which is significantly more than the US$9.86 billion gathered at this point last year.

Assets invested in ESG ETFs and ETPs increased by 7.3% from US$82 billion at the end of May 2020 to reach US$88 billion a new record at the end of June, according to ETFGI’s June 2020 ETF and ETP ESG industry landscape insights report, an annual paid-for research subscription service.  (All dollar values in USD unless otherwise noted.)

Highlights

  • Total Assets invested in ESG ETFs and ETPs listed globally reached a new record of $88 Bn.
  • $32.02 Bn of net inflows into ESG ETFs/ETPs listed globally is significantly greater than the $9.86 Bn at this point in 2019
  • Products domiciled in Europe account for 50.9% of overall ESG assets followed by those in the US with 40.5% and then Asia Pacific ex Japan with 5.8% of the assets  

“The S&P 500 gained 1.99% during June.  In Q2, U.S. equities staged a recovery from the Q1’s decline.  Although Covid cases in the U.S. are still increasing the stimulus from the Fed and Congress, aided the market rebound. During June developed markets outside the U.S. were up 3.44% and up 16.8% in Q2.  In June Hong Kong (up 11.35%), New Zealand (up 10.09%) Netherlands (up 8%) and Germany (up 6.08%) as the top performers. Emerging markets gained 7.6% in June and are up 19.3% in Q2.” According to Deborah Fuhr, managing partner, founder and owner of ETFGI.

Since the launch of the first ESG ETF/ETP in 2002, the iShares MSCI USA ESG Select ETF, the number and diversity of products have increased steadily, the Global ESG ETF/ETP industry had 369 ETFs/ETPs, with 1,019 listings, assets of $88 Bn, from 89 providers on 31 exchanges in 25 countries.  During June, 21 new ESG ETFs/ETPs were launched.

Substantial inflows can be attributed to the top 20 ETFs/ETPs by net new assets, which collectively gathered $2.67 Bn at the end of June, CSIF IE MSCI USA ESG Leaders Blue UCITS ETF – Acc (USESG SW) gathered
$321.29 Mn.

Confusion persists around what constitutes an ESG fund. According to PRI, a UN-supported initiative which seeks to understand the investment implications of ESG issues, 56% of adopters believe there is a lack of clarity in ESG definitions. ETFGI’s classification system attempts to provide greater precision, with ETFs/ETPs listed globally organised into categories, including core ESG products and theme-based groups, such as Clean/Alternative Energies and Gender Diversity.

Source: ETFGI

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