With US$307 billion in inflows, Europe made up 94% of all net worldwide inflows for the second quarter, although this was nevertheless a 57% decrease from US$71.7 billion in the first quarter.
With 10.8% and 6.3% of the assets in the area, respectively, South Korea and Taiwan continue to be the two Asian nations outside of China and Japan with the largest markets for ESG funds.
Hortense Bioy, Morningstar’s global director of sustainability research, stated: “Amid investor concerns over a global recession, inflationary pressures, rising interest rates and the conflict in Ukraine, sustainable funds net inflows plummeted in the second quarter, [but] fared better than the broader market.”
According to a report from the consultancy Cerulli, sustainability-themed ETFs in Asia saw a doubling of their total combined assets to US$10.5 billion in 2021; nevertheless, some of these launches have failed due to the development of many competing ETFs in China.
“ETFs have been a popular channel for asset managers to put forth the ESG/thematic ideas to reach investors in China and the popularity of funds of specific themes has been influenced by the Chinese government’s commitment to pursue economic transformation,” said Jackie Choy, Morningstar’s director of ETF research for Asia.
