ESG ETFs coming out strong for the end of the year

ETF issuers have been pushing hard on ESG ETFs since the beginning of the year, especially in Europe, with 153 new ESG ETFs launches in 2022 to date. They represent 64% of the AUM of the 234 ETFs introduced this year. 

ESG activity in Europe overview

European investors are particularly attracted by ESG strategies, as reflected in the latest flow data. Out of more than USD$50 billion in inflows recorded for ESG ETFs globally, USD$41 billion came from Europe. And despite a disappointing performance of -25% YTD (combined average), AUM in ESG ETFs grew by 8.7% YTD. 

When viewed under the lens of Sustainable Development Goals (SDGs), strategies aligned to Climate Action (SDG 13), affordable and clean energy (SDG 7) and Peace, Justice, and Strong Institutions (SDG 16), recorded the largest inflows with USD$13.3 bn, $1.9 bn and $1.3 bn YTD, respectively. 

Europe is the leading market for ESG ETFs, with a total of 952 ETFs compared to 407 in North America and just 42 in the APAC region. For investors wishing to learn more, Trackinsight’s ESG hub provides detailed information on the sustainable investment landscape, as well as a powerful ETF screener to assist with fund selection.  

The following European ESG ETFs, listed according to the issuer, have launched since the beginning of September:  

ESG ETFs launched by Amundi

Amundi’s new range of ESG-screened sector funds provides exposure to large- and mid-capitalization companies within a number of developed market sectors:

• Amundi S&P Global Financials ESG UCITS ETF
• Amundi S&P Global Consumer Staples ESG UCITS ETF
• Amundi S&P Global Communication Services ESG UCITS ETF
• Amundi S&P Global Industrials ESG UCITS ETF
• Amundi S&P Global Health Care ESG UCITS ETF
• Amundi S&P Global Energy Carbon Reduced UCITS ETF
• Amundi S&P Global Consumer Discretionary ESG UCITS ETF
• Amundi S&P Global Information Technology ESG UCITS ETF
• Amundi S&P Global Materials ESG UCITS ETF
• Amundi S&P Global Utilities ESG UCITS ETF

ESG ETFs launched by LGIM

LGIM added a further four funds targeting thematic and growth-oriented investment opportunities. Their new metaverse fund sits within their newly created ‘Access’ range, with the remaining three funds bolstering their existing lineup of thematic funds screened for ESG criteria.  

• L&G Metaverse ESG Exclusions UCITS ETF
• L&G Emerging Cyber Security ESG Exclusions UCITS ETF
• L&G Global Thematic ESG Exclusions UCITS ETF
• L&G Optical Technology & Photonics ESG Exclusions UCITS ETF

ESG ETFs launched by Invesco, HSBC & others

Invesco has introduced a new hydrogen economy ETF providing access to the growth potential of companies contributing to hydrogen activities such as hydrogen storage and production.

• Invesco Hydrogen Economy UCITS ETF

And finally, HSBC is in the process of launching four value and small-cap ESG ETFs targeting world and emerging market equities. The HSBC MSCI World Value ESG ETF is currently trading on the London Stock Exchange, with the remaining funds due to launch by the end of the month.    

More ESG ETFs are scheduled between now and the end of the year; Fineco has announced a new range of 11 new ESG sector ETFs, Vanguard plans to list two ESG-focused emerging markets ETFs, and Goldman Sachs Asset Management is looking to launch a Paris-Aligned Climate World Equity UCITS ETF.