Observations:

• Conventional fixed income mutual funds and ETFs have accumulated $4.8 trillion in assets under management as of year-end 2023 and account for 24% of all long-term mutual funds and ETF assets under management—a combined total of $19.8 trillion.
• By way of comparison, sustainable bond mutual funds and ETFs, at $46.9 billion as of the same date, account for a smaller 14% of long-term sustainable fund assets under management. This suggests that there is additional room for growth for sustainable bond funds. For example, by expanding the government funds category and/or introducing various iterations of municipal bond funds along state and credit quality lines, to mention just a few, are not currently available to investors in the sustainable bond funds segment.
  Sustainable bond funds are concentrated across fund firms, fund categories as well as funds.
• The top 10 firms of 57 firms that offer sustainable bond funds, manage $38.4 billion and account for 82% of assets. At the same time, the top three sustainable fund categories, including Intermediate Core Bond, Intermediate Core-Plus Bond and Short-Term Bond funds, managed a combined total of $31.2 billion that account for 66% of assets under management.
• The largest ten sustainable bond funds, consisting of both active and passively managed funds, such as the TIAA-CREF Core Impact Bond Fund at $6.3 billion as well as the second largest iShares ESG U.S. Aggregate Bond ETF at $3.6 billion, manage over 50% of the segment’s assets under management.