Thailand and Taiwan were the standout markets in Asia ex-Japan during the fourth quarter for ESG as both experienced sharp increases in sustainable fund assets, Morningstar data show.
Sustainable fund assets in Taiwan grew by nearly half a year on year to reach $13.6bn at the end of 2023, helped by a buoyant local market as well as a series of fund launches.
The largest fund launch in the region during the fourth quarter was the Taiwan-domiciled Taishin TIP Customized Taiwan ESG High Dividend Small/Mid-Cap ETF.
Meanwhile, assets domiciled in Thailand reached $236m at the end of December from just $75m at the end of August thanks to a series of product launches.
During the fourth quarter, 29 new sustainable funds were launched across the region, the largest number since the third quarter of 2022, 22 of which were located in Thailand.
India also saw sustainable fund assets rise by 5.3% to $1.4bn despite experiencing outflows, thanks to positive market performance.
India’s sustainable funds are exclusively held in equities, which remained the dominant asset class in the region, accounting for roughly two-thirds of Asia ex-Japan sustainable fund assets at the end of December, versus 23% and 6% for allocation and fixed- income funds respectively.
Outside of the region, Japan saw total sustainable funds swell to $25.4bn in the fourth quarter, an increase of 7.2%, which was almost entirely driven by market appreciation as the country recorded its seventh consecutive quarter of outflows.
Finally, in Australia, sustainable investments reached $31.2bn as of November 30, which is $100m higher compared with September 30.