ESG Funds Face Declining Investments as Sustainability Takes a Backseat

Recent Shift in Investor Sentiment Towards ESG and Sustainability Funds

Until recently, investors were pouring money into ESG and sustainability funds. According to Alyssa Stankiewicz of Morningstar, these funds received roughly $20 billion in 2019, $50 billion in 2020, and $70 billion in 2021. During this period, ESG investments even outperformed traditional investments. However, there has been a recent shift in investor sentiment, with more money being pulled out of ESG and sustainability funds than being invested.