ETFGI Reports Assets Invested In Environmental, Social, And Governance (ESG) ETFs And ETPs Listed Globally Reaches A Record US$25 Bn At The End Of January 2019

ETFGI, a leading independent research and consultancy firm covering trends in the global ETF/ETP ecosystem, reported today that Environmental, Social, and Governance (ESG) ETFs and ETPs listed globally gathered net inflows of US$730 million during January. Total assets invested in ESG ETFs and ETPs increased by 9.97% from US$22.47 billion at the end of December, to a record US$24.71billion, according to ETFGI’s January 2019 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 rose 9.97% in January 2019, to reach record AuM of $25 Bn.
• ESG ETFs and ETPs listed globally gathered $730 Mn in net new assets during January.
• Europe leads with the most ESG ETFs/ETPs listed, followed by the US.

“In January, equity markets rebounded from Q4 when global equities suffered steep declines amid persistent worries over trade and economic growth. Fed chair Powell revised his stance on where he believes the neutral rate of interest lies, easing fears of a dramatic and painful tightening cycle. Energy’s decline during the Q4 rout subdued inflation in developed economies taking hiking pressure off central banks while provided stimulus to consumers and businesses, giving stronger core metrics. The S&P 500 finished January up 8.01%, the best January since 1987, while the S&P Topix 150 gained 7.26% and the S&P Europe 350 gained 6.23%. Emerging and Frontier markets were up 7.77% and 4.61% respectively, hampered by dollar strength.” according to Deborah Fuhr, managing partner and founder of ETFGI.

At the end of January 2019, there were 210 ESG classified ETFs/ETPs, with 500 listings, assets of $24.71 Bn, from 61 providers listed on 26 exchanges in 23 countries. Following net inflows of $730 Mn and market moves during the month, assets invested in ESG ETFs/ETPs listed globally increased 9.97%, from $22.47 Bn at the end of December 2018, to $24.71 Bn.

Global ESG ETF and ETP asset growth as at end of January 2019

Since the launch of the first ESG ETF/ETP in 2002, the iShares MSCI USA ESG Select ETF, the number and variety of products has increased steadily, with 210 ESG ETFs/ETPs listed globally at the end of January 2019. 2 new ESG ETFs/ETPs were launched by 2 providers during January 2019.

Substantial inflows can be attributed to the top 20 ETFs/ETPs's by net new assets, which collectively gathered $888.50 Mn in January, the UBS ETF (LU) MSCI Emerging Markets Socially Responsible UCITS ETF (USD) A-dis (MSRUSA SW) gathered $165.73 Mn alone.

Top 20 ESG ETFs/ETPs by net new assets January 2019

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.