๐Ÿ‘€News from the flow side: What happened in H1 2021 in Europe to sustainable funds?

16 July 2021

In Europe, in H1 2021, total sustainable fund flows surpassed the 2020 level and reached โ‚ฌ237bn vs โ‚ฌ231bn for the whole 2020. This is true for both active and passive funds (Source Morningstar 30/6/2021). Sustainable passive fund flows equal the 2020 record level at โ‚ฌ59bn. Sustainable active fund flows surpassed the 2020 record level at โ‚ฌ178bn.

๐ˆ๐ง ๐Ÿ๐ข๐ฑ๐ž๐ ๐ข๐ง๐œ๐จ๐ฆ๐ž, ๐ฉ๐š๐ฌ๐ฌ๐ข๐ฏ๐ž ๐Ÿ๐ฎ๐ง๐๐ฌ ๐ฌ๐ก๐จ๐ฐ ๐ญ๐ก๐ž ๐ฌ๐ญ๐ซ๐จ๐ง๐ ๐ž๐ฌ๐ญ ๐ฆ๐จ๐ฆ๐ž๐ง๐ญ๐ฎ๐ฆ.

Sustainable passive fixed income fund flows at โ‚ฌ14bn surpassed the 2020 record level of โ‚ฌ11bn by 27%. This represents 30% of sustainable fixed income fund flows in Europe at the end of H1 2021 vs less than 20% in 2020.
Fixed income passive funds are quickly expanding especially since the Covid 19 crisis last year. They offer an alternative form of engagement by influencing the way indices are built. Active fund flows on their side are sustained but still 20% below the 2020 level.

๐ˆ๐ง ๐ž๐ช๐ฎ๐ข๐ญ๐ฒ, ๐š๐œ๐ญ๐ข๐ฏ๐ž ๐Ÿ๐ฎ๐ง๐๐ฌ ๐š๐ซ๐ž ๐ฌ๐ญ๐ซ๐จ๐ง๐ ๐ฅ๐ฒ ๐ซ๐ž๐š๐œ๐ญ๐ข๐ง๐  ๐ญ๐จ ๐ฉ๐š๐ฌ๐ฌ๐ข๐ฏ๐ž ๐œ๐จ๐ฆ๐ฉ๐ž๐ญ๐ข๐ญ๐ข๐จ๐ง.

This trend has accelerated since the Covid 19. They already gathered โ‚ฌ99bn of flows, i.e. the record level of 2020 flows. This compares to โ‚ฌ12bn of flows in 2019. Passive fund started to attract interest earlier with โ‚ฌ32bn of flows in 2019 and continue to be sustained with โ‚ฌ45bn of flows in H1 2021 vs โ‚ฌ48bn in 2020.

๐Ÿ‘‰Even in sustainable funds, both active and passive have a role to play in portfolio.

Marlene Hassine Konqui