‘When it comes to sustainable investing, it pays to be active’

‘When it comes to sustainable investing, it pays to be active’

A narrative has taken root over the past few years that sustainable investment funds have had their time in the sun.

With growth so inextricably linked, many argue that sustainable investment cannot be successful in a world of high interest rates.

It is true that 2022 was a challenging year for sustainable investments as inflation soared and interest rates quickly had to catch up.

With growth style companies so much more sensitive to this high interest rate environment than value, it was inevitable that sustainable funds would suffer.

In the US, where the political situation makes things a little more nuanced, sustainable funds saw their worst ever quarter of flows in the first three months of this year, with $8.8bn (£6.7bn) being redeemed. 

Despite this poor investor sentiment, it might surprise many to find out that sustainable funds had a very successful 2023.

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