{"id":31257,"date":"2024-09-26T13:39:47","date_gmt":"2024-09-26T11:39:47","guid":{"rendered":"https:\/\/www.laragon.es\/energy-transition-funds-outstrip-environmental-funds\/"},"modified":"2024-09-26T13:49:23","modified_gmt":"2024-09-26T11:49:23","slug":"energy-transition-funds-outstrip-environmental-funds","status":"publish","type":"post","link":"https:\/\/www.laragon.es\/en\/energy-transition-funds-outstrip-environmental-funds\/","title":{"rendered":"Energy transition funds outstrip environmental funds"},"content":{"rendered":"\n
Investor interest in energy transition funds has undergone a marked shift, with an increasing focus on companies that facilitate the shift from polluting to sustainable economic models. A recent report by the European Securities and Markets Authority (ESMA) <\/a>reveals that net flows into transition-focused funds have almost doubled those into environmental funds over the past two years.<\/strong><\/p>\n\n This biannual ESMA report, entitled \u2018Trends, Risks and Vulnerabilities\u2019 (TRV), highlights the urgency of \u2018significant public and private finance\u2019 to meet the objectives of the European Green Deal <\/a>and support the green transformation of the economy. Despite promising growth in interest in sustainable investments in recent years, ESMA expresses concern about the ability to sustain the flow of private capital towards the transition, especially in light of political pressure in the US, which has led to increased caution around ESG investments and shareholder engagement. <\/p>\n\n In the face of these tensions, the report indicates that ESG investment adoption and growth in ESG markets have stagnated in 2023. Interest in products with sustainable features has remained relatively stable in the first half of 2024. <\/p>\n\n Although the emerging \u2018transition investment funds\u2019 category remains small, with EUR 39 billion in assets compared to EUR 260 billion i<\/strong>n funds with \u2018green\u2019 or \u2018low carbon\u2019 designations, net flows into these funds have doubled the pace of their green counterparts over the past two years.<\/p>\n\n This growth in transition funds follows recent ESMA recommendations to establish a categorisation system for sustainable and transitional investments. In a June 2024 assessment of the EU Sustainable Finance Disclosure Regulation (SFDR), the European Supervisory Authorities (ESAs), including ESMA, proposed the creation of a Transitional category for financial products that invest in activities or assets that are not yet sustainable but have the potential to become sustainable over time, aligning with EU and global environmental and social objectives. <\/p>\n\n <\/p>\n