At some of the world’s largest asset managers, the momentum for launching ESG (Environmental, Social, and Governance) funds is noticeably slowing down. Firms such as BlackRock Inc., Deutsche Bank AG’s DWS Group, and the asset management arm of UBS Group AG have significantly reduced the number of new funds aimed at sustainability mandates, as revealed by data from Morningstar Direct.
This year, up to the end of May, just over 100 ESG funds were introduced globally. This places the industry on a trajectory to fall markedly short of recent years’ launch volumes. For context, there were 566 ESG fund launches in 2022 alone.
The trend suggests that backlash and scrutiny facing ESG criteria have begun influencing fund managers’ strategies. Regulatory pressures, evolving market sentiments, and the debate over ESG’s impact on financial performance could be contributing factors. Such dynamics necessitate ongoing vigilance and adaptation from corporate legal professionals advising asset managers and corporations.
For more detailed analysis, see the [full article](https://news.bloomberglaw.com/esg/backlash-against-esg-seen-in-sharp-decline-of-fund-launches-1) on Bloomberg Law.