ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Free Cash Flow
    • Future ETFs
    • Global Diversification
    • Gold & Silver Investing
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Market Insights
    • Megatrends
    • Modern Alpha
    • Multi-Asset
    • Night Effect
    • Portfolio Strategies
    • Retirement Income
    • Richard Bernstein Advisors
    • Tax Efficient Income
    • Thematic Investing
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • Company
    • About Us
    • Swag Store
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. ESG Channel
  2. Expect ESG to Drive Markets in 2022
ESG Channel
Share

Expect ESG to Drive Markets in 2022

Karrie GordonJan 03, 2022
2022-01-03

Environmental, social, and governance (ESG) funds brought in around $120 billion in flows last year as increasing focus by regulator bodies, advisors, and investors continued to propel the space forward. 2022 is expected to see more growth for ESG, not just in terms of greater inflows but as an actual trend that will shape markets, reports Yahoo Finance.

Global markets are seeing a growth fiscally centered around renewables and sustainable energy, and it’s expected to pick up within the U.S. this year as well, believes Aniket Shah, the global head of ESG and sustainability research as Jefferies.

“We are seeing 2022 as the year when ESG not only becomes mainstream, but it starts driving markets a lot more,” said Shah in an interview with Yahoo Finance Live. “And the reason why this will happen is because core parts of the financial system, including the central banks, are going to become even more serious about climate change as they are today.”

Analysts are anticipating the stalled Build Back Better bill that focuses on climate change within the U.S. to pass sometime in the first half of 2022 and mirror a global trend of increased focus on decarbonization from regulatory bodies. The passage of the bill would be a huge boon for ESG funds, but in the meantime, the change is being driven from the bottom up.

“It’s a lot less of a policy-driven market in the United States and a lot more driven by what asset managers need to see, what banks need to see, and how companies can differentiate themselves,” said Aaron Franklin, head of sustainable finance at SMBC. “That’s distinguished from the European approach of having a bit more of a top-down, did this comply with the definition of sustainability.”

Regulation could very well be coming from the SEC this year in regards to climate change disclosures from companies; last year, the regulatory body compiled public statements regarding ESG reporting and the kind of data and metrics being used. The vast majority were in favor of increased disclosure and mandates around what is reported, how the information is collected, and accountability.

In addition to domestic regulations, the newly created International Sustainability Standards Board created during the global summit could also be releasing regulations on disclosures that would apply to financial markets early this year as well.

“We see the ISSB becoming the global standard-bearer of ESG disclosure in 2022,” analysts from Jefferies wrote. “As more companies disclose ESG-related information based on ISSB, the standard will become the driver of materiality, just like with financial disclosures. We recommend investors become familiar with the ISSB approach in 2022.”

State Street Global Advisors offers a variety of ESG funds with different investment strategies and plans, from the broadly investing SPDR S&P 500 ESG ETF (EFIV B+), to a governance-focused fund with the SPDR SSGA Gender Diversity Index ETF (SHE B-), to a fund that focuses on clean energy technologies with the SPDR S&P Kensho Clean Power ETF (CNRG A-).

For more news, information, and strategy, visit the ESG Channel.

Loading Articles...
Help & Info
  • Contact Us
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © 2023 VettaFi LLC. All rights reserved.
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X