An analysis conducted by the Austrian Financial Market Authority (FMA) shows a trend among Austrian retail funds towards more sustainable and more closely ESG -related investments. As of 30 June 2024, 477 Austrian retail funds with a cumulative net asset value of € 70.2 billion take sustainability or ESG-related features into account in investment. 191 retail funds managing € 38.5 billion in assets use such terms in the fund’s name.
Funds that consider sustainability or ESG-related features in investment now make up the majority of the Austrian retail fund sector – and account for 60 % of the aggregate net asset value managed by retail funds, A large proportion are funds in accordance with Article 8 SFDR (464 retail funds, with a combined net asset value of € 67.6 billion) known as “light green” funds, that take into account ecological or social features, but which do not pursue sustainable investment as defined in Article 9 SFDR. Some 13 “dark green” retail funds with managed net asset value of € 2.6 billion meet this stricter benchmark.
The increase in net asset value, in both relative and absolute terms, of retail funds that take sustainability or ESG-related features into account therefore primarily results from the inflow of funds. While the Austrian retail fund market as a whole observed outflows of € 3.4 billion from the start of 2022 until mid-2024, a € 2.7 billion inflow of funds was observed for funds with sustainability or ESG-related features in their investment.
As the ESG market grows, the risk of greenwashing also increases. The FMA reviews the disclosures of funds as well as the disclosed investment strategy to counteract this. The FMA uses a greenwashing analysis framework to do so, which also makes used of automated text analysis and artificial intelligence methods. The FMA’s analyses show that the degree of sustainability is also reflected in funds’ disclosure. The more sustainable a fund is declared to be and described accordingly in disclosure, the more sustainable its investments are too.
Naturally a broad range of sustainable funds exist, which on the one hand underpins the FMA’s focus on analysis for potential greenwashing, but which also shows the necessity for investors, to consider this issue in greater depth prior to investing in a fund, about whether the fund’s specific sustainability aspects also match their own sustainability preferences.
The full report can be found on the FMA website by following this link.
Journalists may address further enquiries to:
Boris Gröndahl (FMA Media Spokesperson)
Telephone: +43 (1) 249 59-6010
Mobile: +43 676 8824 9995
E-Mail: [email protected]