India Has Fewer ESG Funds Than Other Top 10 Economies: Report

The Securities and Exchange Board of India (SEBI) announced new disclosure norms based on ESG parameters for the top 1,000 listed companies by market cap in May.

India has fewer funds focused on environmental, social and governance (ESG) issues than other top 10 economies, data shows, amid investor caution about ESG funds that have yet to build a track record in India's market. The world's sixth largest economy has 23 ESG funds, Refinitiv data shows, compared to the United States and Britain with more than 500 each, while Japan has 182 and China has 119. Other economies in the top 10 also have more ESG funds. "Indian investors are not completely attuned to the concept of sustainable investing, unlike global markets led by Europe, where sustainable investing has been present for many years," said Kaustubh Belapurkar, director at Morningstar India. Analysts said investors were reluctant to put cash into ESG funds as most funds in the sector were new and could not show a track record of outperformance.