SINGAPORE — 9 NOVEMBER 2026
Is the enthusiasm for sustainable investing in the globe starting to lessen in Asia, or are investors becoming more selective with their investments? A new set of investment figures brings about an intriguing question, as Singapore is considered the region’s biggest supplier of sustainable fund withdrawals for the third quarter of 2026, while global investments are still growing.
As per the data published in the Singapore Business Review on 9 November 2026 by Morningstar, Singapore’s sustainable fund net outflow was approximately $870 million during the aforementioned time. This fact places Singapore at the centre of the regional investment shift, suggesting serious implications for sustainable finance projects in Asia.
One investment product is particularly recognised in this news article. The iShares MSCI Asia ex-Japan Climate Action ETF is the most significant influencer in the total amount of outflows since it generated around $880 million of withdrawals. The product is owned by BlackRock, it is registered in Singapore, and it monitors the index aimed at finding companies that are well-positioned and taking action in terms of climate transition.
Because of the expected result of the investment approach, the withdrawals carry special importance. Unlike in conventional finance, the climate indices measure how companies handle the issues pertaining to the transition to a low-carbon economy. Therefore, the large amount of withdrawals shows that the transformation of sustainability objectives into investment demand is still challenging.
Nonetheless, Singapore’s case does not point to a universal withdrawal trend in the entire region of Asia.
In the regions of Asia, ex-Japan, with the exception of China, sustainable funds faced approximately US$144 million of withdrawals in total during the third quarter. Taiwan played a key role in attracting approximately US$779 million of sustained investment inflows into sustainable funds in Asia.
The second top outflow was South Korea, with withdrawals of around US$253 million, while Japan also had around US$204 million of net outflows, thus extending the withdrawal period to 17 quarterly periods.
Another notable trend is the emergence of new investment solutions. In fact, the only market that launched sustainable funds in the Asia ex-Japan region in Q3 is China, where seven products were presented. Such focused growth raises questions regarding how fast the innovation is occurring and whether other asset managers in the region will follow suit with their own sustainability-driven offerings.
At the same time, when looking at the global level, the trends seem vastly different.
It is estimated that various sustainable funds around the world received new investments totalling US $6.5 billion net in the third quarter of the year 2026, excluding China. This is more than US$3.7 billion in the second quarter. Hence, it proves that there is still global interest. Europe has performed the best, having attracted approximately US$9.4 billion, while the U.S. suffered net withdrawals of US$2.8 billion.
Despite the positive development of investments, this trend led to an overall decrease in the total assets of sustainable funds worldwide. By the end of September 2026, total assets decreased to nearly 3.79 trillion dollars from around 3.87 trillion dollars at the end of June. Therefore, one must realise that just increasing the investments will not cause the increase in assets, since it is also a result of the market valuation and changes in finance.
In conclusion, the results of the third quarter of Singapore are a major problem for the sustainable investments sector. Investors do not have to step back from their environmental and climate strategies; they may simply require more financial returns from their investments, as well as more transparency and better proof of sustainability.
For Asia, the question is not how many companies say they will be greener, but how well one can prove that one’s investment will yield successful financial and environmental results.
