US Sustainable Fund Investment Soars to Record High in H1 2019

Investment in sustainable funds tallied an estimated $8.9 billion during the first half of 2019, according to Morningstar, easily surpassing the $5.5 billion of inflows reported for all of last year. It is set to be the fourth straight year inflows into sustainable funds set a calendar-year record.

Inflows set a quarterly record during the second quarter of the year with $4.7 billion, beating the record of $4.1 billion set the previous quarter. Both quarters smashed the previous quarterly record of $1.9 billion that had been set during the fourth quarter of 2016.

The largest net flows in the second quarter went to the iShares ESG MSCI USA Leaders ETF, which drew $1.4 billion. More than $800 million of that amount came from Finnish pension insurance company Ilmarinen at the launch of the fund. Exchange-traded funds (ETFs) took in 58% of overall flows for the quarter.

Another 15 funds attracted no less than $100 million in net flows in the second quarter, eight of which are passive equity funds, including two Vanguard funds, four iShares ETFs, and the Calvert US Large Cap Core Responsible Index. Five are actively managed equity funds, and two are actively managed bond funds.

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Data showed that 138 out of the 271 sustainable open-end and ETFs available to US investors tracked by Morningstar had positive estimated net flows for the quarter of at least $1 million, while only 58 had negative net flows of at least $1 million. The rest of the funds had inflows or outflows of $1 million or less, while two funds saw negative net flows of more than $100 million.

All of the funds in the group integrate environmental, social, and governance (ESG) principles into their investment process, and/or pursue a sustainability-related theme, and/or seek measurable sustainable impact alongside financial return. The group doesn’t include funds that employ only limited exclusionary screens without a broader emphasis on ESG, or funds that only say they may consider ESG factors in their security selection.

BlackRock’s iShares attracted the most assets, while Calvert, which offers a full suite of ESG funds, drew an estimated $780 million. Vanguard also drew assets into its ESG funds, which now total four with the June launch of the actively managed Vanguard Global ESG Select Stock. The fund took in $57 million in its first month.

“For some time, we’ve seen growing levels of investor interest in sustainability but, in the fund universe, a lack of availability across the range of asset classes,” wrote Jon Hale, Morningstar’s head of sustainability research, on the company’s website. “With record numbers of sustainable funds launched since 2015, the supply side has been largely addressed.”

Danish Pension Debuts Line of Sustainable Products

Tags: BlackRock, ETFs, Ilmarinen, iShares, Morningstar

MSCI Appoints Chitra Hepburn as Head of APAC ESG Client Coverage

MSCI has appointed Chitra Hepburn as head of environmental, social, and governance (ESG) client coverage for Asia Pacific (APAC).

Hepburn is based in Shanghai and reports directly to Jack Lin, head of APAC client coverage at MSCI. She will be responsible for driving the growth of MSCI ESG Research in the APAC market, as well as leveraging its ratings, research, and data across MSCI, such as ESG indexes and ESG analytics.

Hepburn most recently was a managing director at ESG Global, where she was responsible for working with issuers to create and implement their ESG metrics in preparation for investor roadshows. Prior to this, she was greater China head of sustainability, corporate communications, and CSR for Bayer, across the three divisions of pharmaceuticals, crop science, and consumer care.

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AIG Appoints Jennifer Waldner as First Chief Sustainability Officer

American International Group has created a position of chief sustainability officer to lead the development and implementation of a company-wide sustainability strategy and appointed Jennifer Waldner to fill the role, effective immediately. Waldner will report to Thomas B. Leonardi, AIG’s executive vice president and vice chair, AIG Life Holdings, Inc.

Waldner has accountability for implementing AIG’s sustainability strategy and developing a corresponding reporting structure. She will lead a cross-functional team to drive global sustainability initiatives while influencing and mobilizing the execution of AIG’s sustainability strategy across the organization.

Scott Boyd joins Principal as Head of Sales in Retirement and Income Solutions

Principal Financial Group announced that Scott Boyd has joined the company as head of sales for workplace savings and retirement solutions in the retirement and income solutions division, effective August 12, 2019.

In his new role, Boyd assumes responsibility for leading the US sales force to serve all customer segments and product solutions. He will report to Jerry Patterson, senior vice president, retirement and income solutions.

Most recently, Boyd served as senior vice president for full-service teams at Prudential, focusing on offerings in the corporate, governmental, tax-exempt, and Taft Hartley markets. Boyd was also responsible for managing the business development and intermediary relations team, maintaining and expanding relationships with key distribution channels nationally.

Prior to joining Prudential, Boyd worked as a strategy consultant for PricewaterhouseCoopers in Boston.

Tags: AIG, MSCI, People Moves, Principal Financial Group