So called Article 8 and Article 9 funds in the EU – categorised as such for their investments with sustainability objectives – suffered outflows of €26.7 billion and €4.7 billion respectively in the fourth quarter of 2023. News site Funds Europe picks up a Morningstar report noting macroeconomic pressures and diminishing investor appetite for ESG products.
“The EU’s Sustainable Finance Disclosure Regulation (SFDR) requires asset managers to provide more information on the sustainability risks and impact of their investment products sold in the EU, with the level of disclosure depending on the sustainability objective of the products,” states investment data provider Morningstar, as quoted by Funds Europe. The Morningstar report itself can be downloaded here against submitting your email.)
Gainers were instead the so called Article 6 funds – those that make no sustainability claim. In all, the total assets of Article 8 and Article 9 funds still grew, by 1.7 percent through the quarter, to a new highest of €5.2 trillion.
These currently make up 60 percent of “the EU universe”, as a trend of reclassifications of funds from Article 6 to Article 8 and Article 9 continues.