Fewer active advertisers spent a higher advertising portion on ESG promotion in Europe

Fund promotion made up more than half of ESG promotion during Q1 2024, according to data by Fundamental Monitor

Key points:

• The number of active advertisers dropped by seven from Q4 2023 to Q1 2024.
• Within ESG messaging, 51% was fund promotion, 29% was brand campaigns and 20% promoted thought leadership insights.
• Although asset managers spent a higher portion of their overall advertising on the promotion of ESG during Q1, investors’ consumption of ESG content on asset managers’ websites was actually down during the quarter compared to the 365-day rolling average.

Fewer asset managers were advertising ESG in Europe during Q1 2024, but they allocated a later percentage of their overall advertising to the promotion of responsible investing, data by Fundamental Monitor shows.

During the first quarter of 2024, 24 out of 86 active advertisers included some ESG messaging in their overall advertising, compared to 31 in Q4 2023. However, these managers on average spent 34% of their advertising on ESG promotion, compared to 28% a quarter earlier. Similarly, ESG accounted for 16% of all recorded ad volume in Q1, up from 14%.

There were only three asset managers who focused solely on ESG promotion during Q1: Nordea Investment Funds, Eden Tree Investment Management, and iShares.

Within ESG messaging, 51% was fund promotion (up from 25% in Q4), 29% was brand campaigns (down only slightly from 30%) and 20% promoted thought leadership insights (down from 46%).

All markets saw some ESG messaging, but the most advertisers were active in the UK (13), followed by Benelux (9) and Switzerland (6), with three advertisers each in Germany, Italy, and the Nordics. This is significantly less than Q4 in all markets, when the UK had 16 active ESG advertisers, Switzerland 12, Benelux 11, and Italy 9.

Although asset managers spent a higher portion of their overall advertising on the promotion of ESG during Q1, data from Alphix Solutions, Fundamental Group’s marketing analytics and activation business, shows that investors’ consumption of ESG content on asset managers’ websites was actually down during the quarter compared to the 365-day rolling average.

Content consumption was down by between 0.84% and 25% during January and February, but by between 46% to 60% in March. However, in the UK, where most of the ESG promotion took place, content consumption was down more consistently throughout the quarter ranging from -6% during the last week of January to -42% during the last week of March.

These figures indicate a mismatch between investor interest and asset managers’ product push. While asset managers were increasing their ESG promotion, investors were reading less content on this topic.

Below are some examples of the type of ESG campaigns that were in market in Europe during Q1 2024:

Federated Hermes

BNP Paribas Asset Management

PGIM Investments