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€9 trillion in European ESG assets by 2025

According to research conducted by PwC Luxembourg, the value of European ESG assets is expected to reach between €7.4 and €9 trillion by 2025.

The information was obtained using the interactive ESG dashboard "The ESG Opportunity in Europe" created by the accountancy company.

This study collected data from 3,354 respondents in the United Kingdom, Switzerland, France, the Netherlands, Germany, the Nordic countries, Spain, and Italy.

This comprised information from institutional investors, individual investors, distributors, and asset managers. In addition to the predicted ESG asset values, according to PwC study, ESG funds will account for between 46 and 56 percent of total European Mutual Fund assets, up from 37 percent at the end of 2021.

PwC said that 66 percent of European institutional investors want to stop investing in non-ESG funds by the end of 2023, with the remaining two-thirds expected to follow suit by then.

Additional study reveals that 71.9% of respondents are willing to pay a premium in order to support ESG products, demonstrating that investors are growing increasingly dedicated to ESG funds.

European-domiciled ESG ETF assets might reach between €684 billion and €904 billion by 2025. This is an increase with a compound annual growth rate between 33.3% and 43.3%. Dariush Yazdani, chief of PwC's global asset and wealth management research unit, stated, “As regulators and society increasingly urge investors to incorporate sustainability considerations within their investment policies and operations, managers will see a continued surge in demand for ESG products in the coming years. 

“Managers looking to seize the ESG opportunity should strive to holistically and consistently incorporating ESG across the board, viewing their entire operations through an ESG lens and adopt an all-encompassing approach to ESG, one that ranges from implementing sustainability into their product offering, all the way to assessing the sustainability metrics of their entire business structure.”


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