ESG advertising in North America drops significantly

Only a tiny percentage of total asset management advertising dedicated to ESG, data from Fundamental Monitor finds

Key points:

• Only a tiny percentage of total advertising – well under 1% – was dedicated to ESG in North America during Q1 2023
• Only four advertisers promoted their ESG capabilities in Q1, all of them focusing on the USA only
• The ESG campaigns were fairly evenly split among the three ad purposes (brand, insights and fund promotion)

Only a tiny percentage of total advertising – well under 1% – was dedicated to ESG in North America during Q1 2023, data from Fundamental Monitor revealed.

While Q4 2022 saw a record 9% of overall asset management advertising dedicated to ESG, the first three months of 2023 saw a massive drop to only 0.26%, the lowest figure seen since records began in 2020.

These latest figures from Fundamental Monitor give an insight into asset managers’ response to the performance woes that ESG strategies have been facing. According to IPE, the year 2022 has been less of a success for global ESG equity strategies as for the first half of the year, 78% underperformed their benchmark, with the median underperforming by 2.5 percentage points. In light of these performance woes, it is perhaps no surprise that asset managers have shifted their advertising activities away from ESG and towards other asset classes and strategies for the time being.It will be interesting to see whether this effect on advertising is a short-term one. 

Only four advertisers promoted their ESG capabilities in Q1, dedicating 31% of their total advertising activity to the promotion of responsible investing. This is a lot less than in Q4, when 18 asset managers were promoting ESG, allocating 34% of their advertisements to the promotion of responsible investing. During Q1, three advertisers were solely focused on ESG promotion: Robeco, Calvert and Federated Hermes.

All four ESG advertisers were only present in the USA, with no ESG advertising seen in Canada during the quarter.

The ESG campaigns were fairly evenly split among the three ad purposes, with insights promotion making up 37%, brand campaigns accounting for 32% and the remaining 31% dedicated to fund promotion. A quarter earlier, ESG brand campaigns made up 62%, followed by thought leadership campaigns (20%) and fund promotion (18%).

Below are some examples of the type of ESG campaigns that were in market in North America during Q1 2023:

Robeco

Calvert

Nuveen Asset Management