Investors focus on sustainability with ETFs

19 Apr 2021

Investors focus on sustainability with ETFs

More than 500 ETFs on Xetra now focus on sustainability – and the trend is rising. The assets invested in ESG ETFs are also growing rapidly. In the first quarter of 2021, the iShares Global Clean Energy UCITS ETF was even among the three ETF products with the highest turnover on the Xetra trading platform for the first time.

What started as a trend will, according to experts, be a driving force behind the choice of investments in the coming years: the topic of sustainability (ESG). Sustainability in investment means including ecological, social and ethical aspects in investment decisions, alongside classic criteria such as profitability, liquidity and security. The total amount of assets managed according to ESG criteria worldwide has increased rapidly in recent years. “As the range of ESG ETFs continues to grow, more and more investors are turning to the sustainable variant of established benchmark indices,” explains Stephan Kraus, who is responsible for the ETF segment at Deutsche Börse.

The continued strong increase in demand for sustainable ETFs is also reflected in the trading statistics for the full year of the first quarter of 2021: with the iShares Global Clean Energy UCITS ETF, for the first time an ESG ETF was among the three products with the highest turnover in Deutsche Börse's ETF segment. The ETF recorded a total order book turnover of EUR 9 billion and aims to replicate the performance of an index that tracks the largest companies worldwide active in the renewable energy sector. The largest stocks within the ETF include Vestas Wind Systems, Enphase Energy, Consolidated Edison, Orsted or Plug PowerFirst Solar.

In total, 733 products classified as ESG ETFs were still available to investors on Xetra at the end of 2022 (2021: 495). Turnover in ESG ETFs rose to €37.3 billion in 2022, an increase of 11 per cent year-on-year (2021: €33.6 billion). Invested assets in sustainable ETFs also exceeded €236 billion at the end of 2022, an increase of 18% year-on-year (Dec 2021: €200.6 billion). At the end of 2022, ESG ETFs accounted for 37% of the total segment and over 23% of invested assets. Trend still rising. Xetra is the leading exchange in Europe not only for ETFs in general but also for sustainable ETFs.

More facts and figures can be found in the ETF Statistics 2021.

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