Morningstar has reported that flows into ESG funds have rebounded strongly after the coronavirus pandemic, more than doubling to $54.6bn over the second quarter of 2020.

In total funds have now surpassed $1tr for the first time on record, attributed to disruption caused by the COVID-19 creating a flight into funds that are seen as resilient, an increase in the number of available options, from a reported 2,584 at the end of March, the number of funds and ETFs that use ESG criteria as part of a selection process in Europe grew to 2,703.

A considerable number of funds are ‘repurposed’ with Morningstar identifying 586 traditional funds in Europe that have repurposed into ESG-focused strategies in the past decade. Repurposing existing funds means that fund managers avoid having to create funds from scratch and, in some cases, accelerating the time frame required to reach scale.

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