Europe remains the key driver behind sustainable finance, holding 83% of global sustainable funds’ net assets, according to the second annual European Sustainable Investment Funds Study by Morningstar and Zeb, powered by the Association of the Luxembourg Fund Industry (ALFI). The study found that the net assets in sustainable fund products based on Morningstar’s strict definition of sustainability have reached almost EUR 2 trillion at the end of 2021, up 71% from 2020.
This study aims to provide a snapshot on how sustainability objectives and the respective legislative interventions are shaping the fund industry in Europe, and to analyse the role, competitiveness, and positioning of the different domiciles within this dynamically changing environment. It is the second of a series of regularly conducted studies based on an analogous approach to monitor the dynamic development and trends of the European sustainable funds’ sector.
The rapidly growing demand for sustainable investing from society and the asset management industry, supported by regulations, means the market share of sustainable funds will only further increase. Eventually, sustainable funds will become the norm rather than the exception.