A USD 6trn ESG headache is bleeding into fund flows

The world’s biggest ESG fund category is also by far its most opaque, and that’s starting to bug investors.
Photo: Charles Sykes/AP/Ritzau Scanpix
Photo: Charles Sykes/AP/Ritzau Scanpix
By Frances Schwartzkopff / Bloomberg

Asset managers are sitting on roughly USD 6trn of funds registered as Article 8, which is a European Union classification requiring that environmental, social and good governance goals be “promoted.” But according to fresh data from Morningstar Inc., roughly a third of such funds “target no sustainable investments.” 

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