Pass me the green
Inside this edition we revisit the integration of Ethical, Social and Corporate Governance considerations through Exchange-Traded Funds (ETFs).
Given this is a popular and growing sub-segment of the funds management industry, we both look to the future and review past performance outcomes from the current listed product suite. Our findings suggest that clients have been inadvertently positioned into Information Technology and growth stocks as a result of product take-up. This can result in greater tracking error and detract from product/issuer core competency.
Bell Potter is of the view that a value or style neutral manager; and more importantly with an impact focus, can function as both a cornerstone or satellite piece in the current market of addressing ESG requirements.
Figure 1 – Equity ‘ESG’ ETF cumulative net money flow
![](https://bellpotter.com.au/wp-content/uploads/2023/03/Figure-1-Equity-‘ESG-ETF-cumulative-net-money-flow.png)
Figure 2 – Top ETF flows for February 2023
![](https://bellpotter.com.au/wp-content/uploads/2023/03/Figure-2-Top-ETF-flows-for-February-2023.png)
Figure 3 – Top ETF flows for 12 months ending February 2023
![](https://bellpotter.com.au/wp-content/uploads/2023/03/Figure-3-Top-ETF-flows-for-12-months-ending-February-2023.png)
Figure 4 – ETF market size as at February 2023
![](https://bellpotter.com.au/wp-content/uploads/2023/03/Figure-4-ETF-market-size-as-at-February-2023.png)
Figure 5 – Trailing average daily volume and value
![](https://bellpotter.com.au/wp-content/uploads/2023/03/Figure-5-Trailing-average-daily-volume-and-value.png)