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In Race to Protect Investor Portfolios, ESG Funds Become Afterthoughts

  • In past two months, ETF flows are down 89% from year ago
  • Theme has been hurt by its reliance on technology stocks

Investors’ desires to do good are melting away in the market downturn. 

Inflows into U.S. exchange-traded funds with higher environmental, social and governance standards have dropped sharply in the past two months. ESG equity ETFs added about $1.2 billion in December and January combined, compared with roughly $10.8 billion in the same period one year earlier -- an 89% drop-off.