ESG ETFs Smash More Records in Q1

Investors ploughed more than $15 billion into exchange traded funds (ETFs) focused on environmental, social, and governance (ESG) themes in March, as total assets invested hit a record $246.5 billion in the first quarter.

Global inflows into ESG-themed ETFs and exchange-traded products (ETPs) in the first three months of the year totalled $55.8 billion, according to data and consultancy company ETFGI.

This total beat the previous quarterly record for net new money into ESG products, $41.2 billion, set in the first quarter of 2020.

ETFGI’s data showed that ESG ETFs and ETPs listed globally gathered net inflows of $15.1 billion during March alone.

Deborah Fuhr, managing partner, founder and owner of ETFGI, cited strong performance of the S&P 500, which gained 4.4% in March and 6.2% in the first quarter. This was “supported by the increasing pace of Covid-19 vaccinations and continued monetary and fiscal support”, she said.

Among the 20 ESG ETFs by March inflows, 11 were US equity focused vehicles, ETFGI reported.

The iShares Edge MSCI USA Minimum Volatility ESG UCITS ETF, listed in Ireland, attracted just over $1 billion in new money during the month. The Canada-listed BMO MSCI USA ESG Leaders Index ETF added $958 million in March.

The biggest inflows for a US-listed ETF went to another iShares fund, the iShares ESG Aware MSCI USA ETF, which brought in $835 million in March. Over the first three months of the year, this fund has attracted inflows of $1.3 billion.

According to ETFGI’s data, total assets invested in ESG ETFs and ETPs increased by 6.9% from $231 billion at the end of February 2021, to $246 billion.

At the end of March, there were 578 ESG products with 1,673 listings worldwide after 46 new sustainable ETFs or ETPs were listed on stock exchanges in February.