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Investors sell $13 billion of ESG funds in 2023 (2024)
| 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 |
Year-end reviews of investments and investing trends are showing that investors pulled about $13 billion from ESG funds last year:
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The money flowing out of funds that invest in companies with environmental, social and governance principles has gone from a trickle to a torrent as investors sour on a sector hit by green-washing concerns, red-state boycotts and boardroom debates. The investing strategy has become increasingly politicized after being used by companies to address E.S.G. issues among their employees, customers and other stakeholders. In a sign of the times, the phrase has been scrubbed from the World Economic Forum’s official program in Davos, Switzerland, after being on the agenda in previous years. Investors pulled $5 billion out of E.S.G.-focused “sustainable” investment funds last quarter, according to a new report by Morningstar. The withdrawals came amid a wider market rally at the end of 2023.[1] |
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Barron’s suggests poor investment performances caused the ESG selloff:
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Poor performance was the biggest drag. Sustainable equity funds generally lagged behind their conventional peers in 2023, though not by as large a margin as in 2022. … The median sustainable large-blend equity fund gained 20.8% in 2023, versus 23.9% for the overall category, which includes sustainable and conventional funds, and compared with 26.9% for the Morningstar U.S. Large-Mid Cap Index.[1] |
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See also
- Environmental, social, and corporate governance (ESG)
- Economy and Society: Ballotpedia's ESG newsletter
External links
Footnotes
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