GS SUSTAIN Tracker_ Marginal Sustainable equity inflows continue; fixed income sees greater strength

Summary of Goldman Sachs GS SUSTAIN Tracker Industry Overview - The report focuses on the sustainable investment industry, particularly sustainable equity and fixed income flows as tracked by Goldman Sachs. Key Points Sustainable Equity Flows - Sustainable equity flows were marginally positive in November, with an increase of $0.4 billion driven by regions outside North America and Western Europe, which saw inflows of $1.0 billion and $0.3 billion respectively [2][4][8] - Active strategies experienced outflows of $6.6 billion, reversing the positive trend from the previous two months, while passive strategies saw inflows of $7.0 billion across all regions [2][17] - Thematic strategies continued to see outflows of $5.1 billion, while integration strategies showed strength with inflows of $5.0 billion [2][10][18] Performance Insights - Fund performance for select thematic ETFs declined in December, while the performance of integration ETFs remained mixed [2][12][18] - The report indicates that sustainable fund performance will be a key driver of assets under management (AUM) direction, more so than potential policy shifts [2] Regional Analysis - Western Europe dominated passive inflows with $5.2 billion, while North America and the rest of the world saw inflows of $0.6 billion and $1.1 billion respectively [17] - Active sustainable equity flows were negative across all regions, with the largest outflows from Western Europe at $5.0 billion [17] Thematic and Integration Strategies - Integration funds drove equity inflows in November, primarily from Western Europe and the rest of the world, while thematic strategies faced significant outflows [10][18] - Climate-related thematic categories, such as 'Climate Action' and 'Resource Security', accounted for the majority of thematic outflows, totaling $3.5 billion and $1.5 billion respectively [18] Market Context - The report notes a relatively high-interest rate environment as a key factor contributing to the underperformance of rate-sensitive thematic categories, particularly renewable energy [18] - The total sustainable fund universe captured in the analysis includes 4,688 funds representing approximately $2.3 trillion in AUM [24] Fund Classification - Funds are classified into various thematic subcategories, including Basic Needs, Climate Action, Healthy Ecosystems, Human Development, and Resource Security [25] - The majority of sustainable AUM is classified as integration funds, which account for 88% of the total sustainable AUM [26] Additional Insights - The report emphasizes the importance of sustainable fund performance as a driver for future growth trends in the sustainable investment category [2][24] - The analysis provides a useful proxy for understanding growth trends in sustainable categories despite the strict classification criteria used [24] This summary encapsulates the key findings and insights from the Goldman Sachs GS SUSTAIN Tracker, highlighting the current state and trends within the sustainable investment industry.