The demand for socially responsible investments has drawn BNP Paribas and iShares into close competition in the exchange-traded fund (ETF) market, figures show.
BNP Paribas appears five times in a global ranking of October asset flows for the top 20 environmental, social and governance (ESG) ETFs compiled by ETFGI, while iShares appears eight times.
BNP Paribas Easy MSCI Europe SRI topped the ranking with sales worth $787 million in October in a product sector that is far outstripping growth in the broader ETF industry.
In the year to the end of October, assets in ESG ETFs and other exchange-traded products have increased by nearly 30% compared to 2.91% for all products of this type.
Overall, the ESG sector of the ETF industry gathered $1.06 billion in October – with €1.02 billion of that going to the top 20 funds.
Total assets under management stood at $21.85 billion, albeit a 2.91% decline due to wider market conditions had seen them higher at the start of the year.
Sixty-two ESG exchange-traded products have been launched in 2018, with 11 during October alone, said Deborah Fuhr, founder of ETFGI. The figures have been compiled and reported on by ETFGI for the first time.
Globally, there are 200 ESG classified exchange-traded products with 447 listings, and 60 providers are in the market.
iShares launched the first ESG ETF product in 2002, with the iShares MSCI USA ESG Select ETF.
Fuhr said confusion persists around what constitutes an ESG fund.
“According to PRI, a UN-supported initiative which seeks to understand the investment implications of ESG issues, 56% of adopters believe there is a lack of clarity in ESG definitions,” she said.
ETFGI’s classification system involves categories, such as ‘clean/alternative energies’ and ‘gender diversity’.
Top 20 ESG ETF products – AUM and net flows, $m, Oct 2018
Source: ETFGI. Ranked by net flows.
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