ESG Funds Q3 Outflows 2025 Reach USD55bn as Morningstar Flags Global Redemptions

ESG funds Q3 outflows 2025 totalled USD55bn, Morningstar reported, driven by UK-domiciled BlackRock fund redemptions linked to a pension client’s shift into custom mandates. Excluding those withdrawals, sustainable funds still recorded USD7.2bn in net outflows versus USD6.2bn of revised inflows in Q2. Europe (ex-BlackRock) lost USD3.1bn and the US posted a 12th straight quarter of withdrawals at USD5.1bn. Asia ex-Japan added USD1.6bn, mainly from South Korea, Thailand, and Taiwan. Fixed income was the only gainer with USD12.5bn of subscriptions, lifting global sustainable assets 4% to USD3.7tr. Morningstar said ESG fund flows face policy uncertainty and backlash amid volatile macroeconomic conditions.