EU ESG Ucits projected to cross €9 trillion by 2027

Investment flows toward the European Union’s ESG Ucits funds surged last year, reaching €6.2 trillion by the end of 2023, marking a €1 trillion year-on-year increase.
Additionally, assets under management are projected to cross €9 trillion by 2027, according to a report by PwC Luxembourg.

The report has provided insights into the evolution of ESG funds across the European Union, including asset manager rankings, a breakdown of Article 8 and 9 funds and data on leading domiciles.

Luxembourg remained the dominant domicile for ESG Ucits funds in the EU, accounting for 45.7% of the total assets under management of Article 8 funds and 60.8% of the total assets under management of Article 9 funds. Amundi stood out with the greatest number of Article 8 Funds compared to other asset managers.

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Key findings from the report reveal that BlackRock (€432.6bn) maintained its top position among asset managers in assets under management of Article 8 Ucits funds, followed by JPMorgan and Amundi. Pictet (€25bn) led among asset managers in assets under management of Article 9 funds, followed closely by Handelsbanken and Candriam.

Additionally, Luxembourg topped ESG funds in the EU with 45.7% of Article 8 assets under management and 60.8% of Article 9 assets under management, followed by Ireland, France and Sweden. Amundi led in the number of Article 8 funds, while Candriam led in the number of Article 9 funds.

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The report also highlighted the active/passive split by the number of Article 8 and 9 Funds, with actively managed funds dominating both categories, albeit with a slight decrease in passively managed funds compared to the previous year.

The study also identified the top EU ESG Ucits by net flows, with Morgan Stanley’s USD Liquidity Fund leading in attracting net flows among Article 8 funds, followed by Handelsbanken’s Global Index Criteria among Article 9 funds.

In the ETF category, JPMorgan’s US Research Enhanced Index Equity took the first place in net flows for Article 8 ETFs, while Legal & General’s US ESG Exclusions PA led for Article 9 ETFs.

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