The resilience of Environmental, Social, Governance (ESG) funds is not completely new. During the Covid-19 crisis – which clearly has strong social and environmental implications – investors perceived their strong performance as a defensive characteristic and cumulative flows continued to increase while massive sales occurred in traditional funds.
The analysis is this commentary shows that investors’ preference for ESG compared to conventional funds has not lessened – quite the opposite, in fact. At the EU level, the focus on ESG is likely to remain strong for asset managers and institutional investors. On a policy level, this has been supported so far by the Action Plan on Sustainable Finance and will continue with the upcoming Renewed Strategy.
The full text of this ECMI Commentary is available here.