Global sustainable fund flows returned to positive territory in the second quarter of 2024 after two successive quarters of net outflows, according to figures from Morningstar Sustainalytics. Sustainable open-ended and exchange-traded funds attracted around US$ 4.3 billion of net new money globally, compared to outflows of US$2.4 billion in the three months to 31 March. Europe drove the improvement, accounting for 84% of sustainable fund assets under management (AUM), and with US$11.8 billion going into its such funds. There is now an estimated US$3.1 trillion in sustainable funds around the world. In the US, outflows for the quarter hit US$4.7 billion – a significant slowdown on the nearly US$9 billion that left the country’s sustainable funds in Q1. Globally, the number of new such funds launched fell to 77 – the lowest it has been since the surge at the beginning of the decade. Morningstar said this reflected a “normalisation of product development activity in this space”, after a period of intense growth. Measured by AUM, BlackRock remained by far the top manager of sustainable funds, with US$374.7 billion. UBS came second with US$177.3 billion, followed by French asset manager Amundi with US$174.2 billion, and Deutsche Bank-controlled investment firm DWS with US$101.4 billion. “The picture for global ESG fund flows is starting to improve,” said Hortense Bioy, Head of Sustainable Investing Research at Morningstar Sustainalytics. “We started the year with outflows, but this has since turned around, with money trickling back into the sector.”
