UBS Asset Management has seen its sustainable ETF range pass €10bn assets under management (AUM), a sign of the increasing demand for ESG products.
The firm launched its first ETF with an ESG tilt in 2011, the UBS ETF MSCI World Socially Responsible ETF (WSRUSA) which became the first ESG ETF listed in Europe to pass the €1bn barrier last July.
The Swiss asset manager was also the first issuer to offer S&P 500 and Euro STOXX 50 ETFs with an ESG screening last year.
Overall, UBS AM offers 19 ESG ETFs across both equity and fixed income with varying degrees of ESG screenings.
Clemens Reuter (pictured), head of ETF and passive investment specialists at UBS AM, commented: “Appetite for our ESG ETF products has grown considerably among institutional and retail investors, who more and more wish to integrate specific sustainability criteria into their portfolios.
“We expect to add new products to our sustainable ETF range this year to meet this client need.”
Michael Baldinger, head of sustainable and impact investing at UBS AM, added: “Sustainable investing is increasingly becoming the standard and is a key area for the firm.”
For ESG ETFs listed in Europe, UBS is second behind BlackRock, which has €11.7bn AUM across its iShares range, while rounding off the top three is Handelsbanken with €3bn, according to data from Morningstar.
Along with passives, Moody's Investors Service said in a recent report ESG is the next growth frontier for asset managers as it is a value proposition they can deliver unlike the promise of delivering consistent outperformance.
Highlighting this, according to a Moody’s survey, asset managers that consider ESG a top three priority have an average AUM replacement rate of 117% over the past three years versus just 73% for managers that did not consider ESG as a top 10 priority.