Is 2021 a defining year for sustainable ETFs?
Asset growth, regulation and ESG adoption are shaping the sustainable ETF market in Europe
The COVID-19 crisis accelerated the need for a more sustainable future and many investors now view climate change as a core consideration in their portfolios. 2020 was a record year for inflows into sustainable passive instruments, partially driven by a superior risk/return profile compared to traditional benchmarks. Also, new EU SFDR regulation has further driven market growth and is a move toward market standardization for sustainable products in Europe.
At UBS ETF we continue to expand our sustainable ETF product suite. We have launched ETFs that replicate the new Paris Aligned Benchmarks, which align portfolios to the Paris Agreement as we believe investor inaction is no longer an option in order to reduce our carbon footprint.