Sustainable funds represent 19% of the European investment fund market, with Europe holding 85% of global sustainable funds’ net assets, according to a report from the Association of the Luxembourg Fund Industry (ALFI). The third edition of the European Sustainable Investment Funds Study, produced in partnership with Morningstar and Tameo, found that the net assets of sustainable funds in Europe totalled €2.2 trillion (US$2.3 trillion) at the end of 2023. The data shows that the European investment fund market has more than tripled from 6% in 2019. The average size of sustainable funds also increased, reaching €416 million in 2023. “Europe continues to lead the global sustainable investment fund market, driven by a robust regulatory framework, including the SFDR, and strong investor demand,” said Britta Borneff, Chief Marketing Officer at ALFI. “The study highlights both the growth and resilience of Europe’s sustainable investment funds. We hope these insights support decision-making, drive progress in sustainable finance, and help build a more sustainable and equitable future.” However, the report also found that the number of new sustainable funds launched has been declining. In 2023, 350 new sustainable funds were introduced, down from 616 in 2022 and 760 in 2021.
