Product launches for Article 8 and 9 funds, sustainability funds and ESG funds are all over the place, but there is no insight into which fund houses are actually putting a lot of assets to work sustainably. Enquiries with Morningstar show that it is certainly not (only) the usual names that have the most assets in sustainable funds.
At the request of Investment Officer, Morningstar ranked the twenty asset managers with the largest amount of invested capital in sustainable investment funds. It is true that big players like BlackRock, Vanguard and UBS are among the twenty fund houses with the most assets in funds with a sustainable intention. However, in relation to their total assets under management, these are less significant figures.
BlackRock: absolutely big, relatively small
Take BlackRock. Together with ETF subsidiary iShares, the fund house manages almost $245 billion in assets within Morningstar’s global sustainable funds category. Within that category, the data collector ranked open-ended funds and ETFs that, according to their prospectuses or other official documents, focus on sustainability, impact or ESG factors.
In total, according to Morningstar, there is 2,777 billion dollars in these types of sustainability funds, of which BlackRock is responsible for 8.8 percent. However, compared to its own assets under management of almost 4,000 billion dollars (at the end of March 2022, Morningstar figures), that is only 6.2 percent.
It should be noted that Morningstar only counts assets under management in open-ended funds and ETFs. The data collector excludes money market funds, feeders and funds of funds to avoid double counting.
Parnassus at 100%
The asset manager from Morningstar’s list that invests the most in investment funds with a sustainable intent as a proportion of total assets under management is Parnassus. This American fund house manages 100 percent of its assets under management of 45 billion dollars in funds with a sustainable basis.
Handelsbanken also scores highly in this area. The Swedish bank has almost 99 percent of its assets under management of about 86 billion dollars in sustainable funds. This also makes it the number 5 fund house with the most assets in sustainable funds in absolute terms.
Also Amundi (130 billion dollars), UBS (113 billion dollars) and BNP Paribas (88 billion dollars) belong to the five asset managers with the most sustainable fund assets, after number 1 BlackRock.
BNP Paribas at 47%
Relatively speaking, apart from Handelsbanken and Parnassus, Swedish SPP has “green” running through its DNA the strongest. Who is doing absolutely and relatively well is BNP Paribas. The asset manager has 47 percent of its assets under management of $187 billion invested in sustainable funds.
In total, the 20 asset managers with the most assets in sustainable funds account for just under half of total assets in sustainable open-ended mutual funds and ETFs.
Morningstar previously wrote in a report on the state of Article 8 and Article 9 funds under European sustainability regulation SFDR that Europe is on track to manage more assets from light green and dark green funds (Article 8 and 9) than from grey funds by 2022.
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