July saw record inflows of £362 million (€403 million) into ESG funds globally despite equity funds overall suffering outflows of £240 million.

According to figures from fund network Calastone, each of the past four months has set a new record for ESG equity fund inflows.

The cumulative total of £1.2 billion inflows into ESG funds since April is greater than all previous five years combined on record.

Funds focused on UK equities were hardest hit, seeing outflows of £377 million in July, taking the two-month total outflow from UK equities to almost £1.1 billion.

Outflows from equity income funds accelerated, breaking the record for a second consecutive month as investors redeemed £705 million of their holdings.

Meanwhile, despite notching up their twenty-sixth consecutive month of outflows, European equity funds shed only £62 million, their lowest level in almost two years and well below the monthly average outflow of £211 million.

The reduction in negative sentiment towards European funds reflects a relatively effective response to the pandemic, Calastone said.