European ETFs turn green as ESG captures 50% of flows year-to-date

Of the $130bn of total flows into European ETFs so far this year, $65.6bn has been directed towards passive products with an ESG strategy or theme.

This compares to just 6% of total flows in the US and 8% of Asia Pacific flows, which both anchored the global flows into ETFs at 14%.

Annual ESG ETF inflows outweigh non-ESG for first time

Despite this, sustainable ETFs continue to break records globally, with $325bn total assets under management, of which $100bn flowed into the space in 2021, already breaking the 2020 total year figure of $88.5bn.

The number of ESG ETFs listed globally continues to rise as well, with 174 new products coming to market between January and August.

Ailing Zhang, ESG ETF analyst at Trackinsight, said: “The impact of the climate crisis is obvious to all eyes that can see. The current wildfires in Turkey, Italy and Greece have not only caught our attention, but are also a vivid illustration of the importance of change.

“However, these latest numbers are cause for hope and indicate that we are witnessing an historic shift in the mentality of European investors who are now putting sustainability at the heart of their investment decisions.”