New thematic ETFs are increasingly seen as active investment vehicles | New


New-style ESG exchange-traded funds (ETFs) are increasingly viewed by investors as active strategies, even though ETFs traditionally track a certain index, according to a new survey.

BNP Paribas Asset Management (BNPP AM) said on its recently launched European ESG ETF Barometer that 82% of respondents consider ESG thematic ETFs to be active strategies.

The survey, conducted in April by FT Longitude on behalf of BNPP AM, showed that ESG ETFs currently account for 16% of all European ETF assets.

According to BNPP AM, 91% of respondents said they expect this level to remain stable or increase over the next 12 months.

The ESG EFT Barometer is to be a biannual survey, according to the asset manager, with the first surveying asset managers and asset owners based in France, Germany, Italy, Switzerland and the UK.

Denis Panel, Head of Multi-Asset, Quantities and Solutions at BNPP AM, said: “The results not only validate the necessary move towards sustainable indices, including the Paris-Aligned Benchmark standards, which BNPP AM adopted at the end of 2021, but also show the increased use of ETFs as a means of accessing ESG themes, with the divide between what was previously considered ‘active’ and ‘passive’ becoming increasingly blurred. »

The French company said that overall the poll showed investors wanted more focus on social issues in ESG engagement and voting practices, with 43% saying they wanted more focus on social issues. focus on employee rights and 42% on board diversity.

Meanwhile, another ETF survey showed that one in 10 European professional investors rate the current ESG offering in the bond ETF market as poor, with a further 29% describing it as average.

European ETF provider Tabula Investment Management’s survey – which gathered responses from 100 professional investors in Italy, France, Germany, the UK and Switzerland – found that only 7% of respondents believed that the current range of ESG fixed income products available was excellent, with others saying it was quite good.

Tabula said 60% of respondents said they wanted to see more innovative products available and 54% wanted better coverage of different fixed income asset classes.

Some 44% wanted greater transparency, the firm said.

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