Global ESG funds saw $84 billion in outflows in 2025, which includes the first year for net redemptions, says Morningstar.

In 2025, global sustainable funds saw $84 billion in net outflows compared with the $38 billion in inflows recorded in 2024. This made 2025 the first year of annual redemptions and the first year of outflows for Europe.

Global sustainable mutual funds and exchange-traded funds saw $27 billion in net outflows in Q4 2025, compared with outflows of nearly $55 billion in the previous quarter.

The Europe sustainable fund market saw $20 billion of redemptions in the final three months of 2025, following record outflows of $49.6 billion in the preceding quarter. However, a large share of the outflows came from large UK institutional investors reallocating their assets from standard to tailored ‘segregated’ ESG funds.

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