ESG-committed AUM continues to grow at a slower pace than non ESG-committed AUM, with more challenges on the horizon

Preqin’s AUM (assets under management) data provides the ability to filter the proportion of overall AUM that is 'ESG-committed', compared to that without specific ESG commitments.

Over the 11-year period from the end of 2010 to the end of 2021, both groups experienced strong growth. ESG-committed AUM saw a compound annual growth rate (CAGR) of 10.8%, while non-ESG-committed AUM grew by a CAGR of 15.3%. Over recent years, focus on ESG has increased, garnering the growing interest of managers. However, since the end of 2015, ESG-committed AUM growth has significantly lagged that of AUM without specific commitments. 

With energy prices elevated and demand for fossil fuels increasing around the world, ESG commitments could be in for a stern test.