Asset Managers ESG Survey Report
The Index Industry Association (IIA) releases 2024 Asset Managers ESG Survey Report, aimed at analyzing asset management companies’ views on current ESG challenges and opportunities.
The 2024 Asset Managers ESG Survey Report collected opinions from 300 Chief Financial Officers, Chief Investment Officers, and Investment Managers in Europe and the United States to identify and track trends in the asset management industry.
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ESG Development in the Asset Management Industry
The ESG development in asset management industry has experienced certain fluctuations, with a net outflow of $88 million in the fourth quarter of 2023 and a net inflow of $900 million in the first quarter of 2024, including a net inflow of $10.9 billion in Europe and a net outflow of $8.8 billion in the United States. In the first quarter of 2024, global ESG fund assets grew to nearly $3 trillion.
Although the proportion of ESG assets has slightly decreased compared to the previous year, 51% of respondents this year stated that companies frequently mention this topic. 59% of respondents believe that customer demand is the primary driving force behind a company’s ESG investments, with other factors including leadership (37%) and regulatory agencies (33%).
Asset Managers’ Expectations for ESG Development
In the previous surveys, Index Industry Association required asset managers to predict the future proportion of ESG assets in their investment portfolios in order to reflect market expectations for ESG development. In the 2021 survey, asset managers believed that ESG assets would account for 35% of investment portfolios in the next three years, and this year’s forecast is relatively consistent with this.
Asset managers in different regions have significant differences in their expectations for ESG development. American respondents believe that ESG assets will account for 18% and 33% in the next year and ten years, while British respondents believe that ESG assets will account for 35% and 58% in the next year and ten years. This difference is consistent with the flow of ESG fund funds mentioned above.
Asset Managers’ Views on ESG Investments
In terms of the reasons for applying ESG investment, respondents generally believe that natural resource use, greenhouse gas emissions, and reputation risk rank among the top three, reflecting the important role of environmental factors in respondents’ ESG investment. 46% of respondents stated that environmental standards are at the forefront of ESG investment, with 32% believing that environmental factors should always be given priority consideration.
Among various environmental standards, respondents place relatively low importance on biodiversity, air pollution, and water pollution. This may be due to the difficulty in measuring these environmental factors compared to natural resource use and greenhouse gas emissions, which have a relatively weak impact on investment portfolios.
Reference:
Index Industry Association 2024 Survey of Asset Managers
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