Demand for ESG-compliant funds is high, but how much growth is there? According to the latest market report by the German professional association FNG, investments by German private investors in sustainable investments rose by 96 percent to 18.3 billion euros, as the market for sustainable investment funds and mandates in Germany is experiencing a real boom. Shares in particular are crucial as sustainable investments, even though bonds account for more money. Growth was strong among private investors, and customer deposits from specialist banks with a focus on sustainability amount to 40 billion euros.
Looking at the investment products, around 269.3 billion euros were invested at the end of 2019 to incorporate environmental, social and governance criteria in the investment conditions, i.e. almost 23 percent more than in the previous year. At the end of 2019, the total amount of investments even reached around 1.64 trillion euros. A distinction is made between sustainable investments with a clear sustainability strategy at product level and responsible investments with a sustainability strategy at company level.
According to the FNG, the reason for the significantly increased interest of private investors is in particular the more intensive reporting on sustainable investments.
In Switzerland in particular, the ESG boom is crystallising as a result of the different survey methodology in the development of the market shares of sustainable funds and mandates in the overall market, because the intensified reporting on sustainable investments has increased the interest of private investors, according to the professional association FNG. The climate and environmental awareness is also massively increased by the “Fridays for Future“, discussions on the coal phase-out, the carbon dioxide tax and other initiatives.
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