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Sustainable fund business faces tougher times after 2020 boom

The ESG investing boost is a rare bright spot to come out of the pandemic, but can it last?

ESG is all the rage but is the green wave sustainable?
ESG is all the rage but is the green wave sustainable? Photo: Getty Images

For sustainable investing, last year could hardly have been more helpful. The pandemic underlined the need for investors to take account of non-financial factors; most funds with a sustainable bias beat the market; and new money flooded into anything with an ESG (environmental, social and governance) label.

But that was the easy bit. As consultant Oliver Wyman warns bluntly in its analysis of asset management trends in 2021, “this happy alignment won’t last”.

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