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Big Three asset managers close ESG funds (2023)
| Environmental, social, and corporate governance |
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| • What is ESG? • Enacted ESG legislation • Arguments for and against ESG • Opposition to ESG • Federal ESG rules • ESG legislation tracker • Economy and Society: Ballotpedia's weekly ESG newsletter |
With American ESG funds continuing to experience outflows and with financial services executives increasingly looking to distance themselves from the term ESG, some of the world’s largest asset management companies—including two of the Big Three passive firms—are shutting down some ESG funds and returning capital to the funds’ investors:
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BlackRock Inc. and other money managers spent years rolling out sustainable funds, seeking to capitalize on surging interest in ESG investing. Now they’re abandoning an increasing number of those products in the US amid political backlash and investor scrutiny. State Street Corp., Columbia Threadneedle Investments, Janus Henderson Group Plc and Hartford Funds Management Group Inc., among others, unwound more than two dozen ESG funds this year, according to data from Morningstar Inc. On Sept. 15, BlackRock told regulators it, too, intends to close a pair of sustainable emerging-market bond funds with total assets of about $55 million. While the US had 656 sustainable funds as of June 30, according to Morningstar data, the number of liquidations is increasing from prior years. More US sustainable funds have closed in 2023 than the prior three years combined, the data show. Investors pulled more money from the funds in the first half of the year than they put into them. “We have definitely seen demand drop off in 2022 and 2023,” Alyssa Stankiewicz, associate director for sustainability research at Morningstar, said in a phone interview. The closings underscore shifting fortunes for sustainable investing as returns disappoint investors and anti-ESG rhetoric persists. … BlackRock Chief Executive Officer Larry Fink stopped using the term ESG earlier this year, saying it has become too politicized. Instead he discussed investments tied to the transition to a lower-carbon economy.[1] |
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See also
- Environmental, social, and corporate governance (ESG)
- Economy and Society: Ballotpedia's ESG newsletter
External links
Footnotes
- ↑ Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
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