Q1 2026 Global Sustainable Fund Report
Morningstar releases Q1 2026 global sustainable fund report, aimed at summarizing the development of the sustainable fund market.
After a sustained global net outflow in 2025, the global sustainable fund market recorded a net inflow of funds in the first quarter of 2026.
Related Post: Morningstar Releases 2025 Global Sustainable Fund Report
Global Sustainable Fund Market Development
In the first quarter of 2026, the global sustainable fund market recorded a net inflow of $3.5 billion, marking a significant turning point from the net outflow of $27 billion in the fourth quarter of 2025. The net inflow mainly came from the European market, which recorded a net inflow of $9.1 billion this quarter, marking the first time since the second quarter of 2024 that the European region has returned to the net inflow range. The US market recorded a net outflow of $4.3 billion this quarter, which is consistent with the outflow scale of the previous two quarters.
As of the end of the first quarter of 2026, the total assets of global sustainable funds amounted to $3.51 trillion, a decrease of 10% compared to $3.90 trillion in the fourth quarter of 2025. The main reason for the decline in asset size is market weakness. Currently, sustainable funds in Europe and the US account for 85% and 10% of the total scale, respectively, while the remaining regions account for 5%. Since the end of 2018, the total assets of global sustainable funds have grown nearly six times (from $600 billion to $3.51 trillion).
In the first quarter of 2026, 17 new global sustainability funds were issued, a significant decrease from 50 in the fourth quarter of 2025 and the lowest value since statistics began. The reasons for the decline include weak performance and a decrease in investors’ attention to ESG. The 17 newly issued funds consist of 9 from Asia and 8 from Europe.
Sustainable Fund Market Development in Europe and US
In 2025, the European sustainable fund recorded a net outflow of $62 billion, marking the first annual net outflow since 2018. This quarter, European sustainable funds recorded a net inflow of $9.1 billion, with passive funds recording a net inflow of $24 billion and active funds recording a net outflow of $14.8 billion. From the perspective of asset categories, sustainable stock funds recorded a net inflow of $2.8 billion (an outflow of $26.1 billion in the previous quarter), and sustainable bond funds recorded a net inflow of $9.5 billion (an inflow of $12.1 billion in the previous quarter).
In 2025, the US sustainable fund recorded a net outflow of $4.3 billion, continuing the 14-quarter net outflow trend since the fourth quarter of 2022. In contrast, traditional funds attracted a net inflow of $337 billion. Passive sustainable funds attracted a net inflow of $3 billion, while active funds recorded a net outflow of $7.3 billion. From an asset class perspective, sustainable stock funds recorded a net outflow of $4.6 billion, while sustainable bond funds recorded a net inflow of $469 million.
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