Europe leading the way in ESG investing

European asset managers are leading the world in ESG product availability, thought leadership and brand positioning, according to new research by Kurtosys Systems.

In its ESG Distribution Study 2020, Kurtosys Systems examined the public websites of the top 100 asset managers by assets under management. The findings explored three major themes – the availability of ESG products, the integration of ESG into brand messaging and the provision of sustainability metrics in investor reporting.

In terms of the availability of ESG products, dedicated ESG labelled funds, or funds focusing on sustainable investing, were made available by precisely 50 of the top 100 asset managers. The UK led the way at 80 per cent, or eight of 10 managers, ahead of the European managers at 73 per cent, or 19 of 26. It was just 44 per cent in the US, or 22 of 50. Across the rest of the world – Japan, China, Australia, Canada and Brazil – the picture was decidedly less developed, with only two of the remaining 14 managers offering ESG products.

As for the integration of ESG into brand and messaging, 24 of the 26 European asset managers in the study incorporated ESG as a core anchor within brand messaging and content. This is in fact a larger percentage than those managers offering dedicated ESG products. In the US, only 42 per cent featured sustainability in any way on websites. In the UK 40 per cent managers anchored core messaging to ESG, meaning that the UK is falling down on communication even if it is ahead on other issues.

Finally, in comparison to the relative abundance of ESG-style products, the reporting accompanying the strategies is much less mature. These ranged from the inclusion of carbon consumption metrics to overall sustainability scores.

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