Investors have put record money into Responsible funds on the HL platform with net flows up 17% so far in 2021 vs the same period in 2020
Emma Wall, Head of Investment Analysis at Hargreaves Lansdown says:
“2020 was a record-breaking year for flows into sustainable, ethical, ESG and impact funds. Strong relative and absolute performance helped push funds in front of previously sceptical investors’ eyes, while both the pandemic and associated lockdown brought environmental and social issues to the top of the news agenda. Expectations for 2021 flows were therefore muted after such a strong preceding year, but once again HL clients have put their money where their morals are and in-flows to responsible investment funds have hit yet another record high. The naysayers are calling a bubble, but many companies held in responsible investment funds – both active and passive – are the beneficiaries of long-term structural trends. Yes the past 18 months has accelerated certain social and economic movements, but the new norm of e-commerce, low-carbon, flexi-working, re-use and repair households are here to stay – as is investors holding businesses accountable for their actions and impact. Investing with environmental, social and governance issues in mind is about more than just doing the right thing however. It is about doing the long-term profitable thing. Being risk aware, horizon scanning and building sustainable portfolios with sustainable profits and dividends.”
Net flows into ESG funds by year
| Year-on-year increase | |
| 2016 | Base year |
| 2017 | 173.83% |
| 2018 | 37.33% |
| 2019 | 248.14% |
| 2020 | 222.02% |
| 2021 (so far) | 17.48% |
Net flows into active ESG funds by year
| Year-on-year increase | |
| 2016 | Base year |
| 2017 | 184% |
| 2018 | 35% |
| 2019 | 257% |
| 2020 | 217% |
| 2021 (so far) | -7% |
Net flows into passive ESG funds by year
| Year-on-year increase | |
| 2016 | Base year |
| 2017 | 240% |
| 2018 | 14% |
| 2019 | 68% |
| 2020 | 212% |
| 2021 (so far) | 966% |
Demographic breakdown
| Top active ESG funds 2016 – 2021 (alphabetical) |
| Aegon Ethical Equity Fund |
| Baillie Gifford Global Stewardship |
| Fundsmith Sustainable Equity |
| Liontrust SF Global Growth |
| Royal London Sustainable World |
| Top passive ESG funds 2016 – 2021 (alphabetical) |
| Legal & General Future World Climate Change Equity |
| Legal & General Future World ESG Developed Index |
| Vanguard ESG Developed World All Cap Equity |
| Vanguard ESG Developed World All Cap Equity Index |
| Vanguard SRI Global Stock |
Most popular ESG funds on the HL Platform 2021 (by total net flow, alphabetical order)
| Top ESG funds 2021 to date (alphabetical) |
| Aegon Ethical Equity Fund |
| BNY Mellon Sustainable Real Return |
| Fundsmith Sustainable Equity |
| Guinness Sustainable Energy |
| Legal & General Future World ESG Developed Index |
| Liontrust SF Global Growth |
| Ninety One Global Environment |
| Royal London Sustainable World |
| Stewart Inv Indian Subcontinent Sustainability |
| Vanguard ESG Developed World All Cap Equity |
HL data provided correct as of 21/09/2021.
