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Amundi's Big ETF Bet Draws Criticism Over Jump in Coal Exposure

Amundi SA’s 825 million-euro ($930 million) acquisition of Lyxor has left a significant dent in its climate credentials, according to a fresh analysis by nonprofit Reclaim Finance. With its takeover of Societe Generale SA’s investment arm now complete, Amundi has become the biggest provider of exchange-traded funds in Europe after BlackRock Inc. But its enlarged status comes at an environmental cost,with the portion of its assets not covered by a coal-exclusion policy jumping 84% to 207 billion euros, the report shows.“If Amundi really wants to be a climate leader, it needs to fix its passive problem, stop supporting the expansion of fossil fuels and get tough with Big Polluters,” said Lara Cuvelier, sustainable investment campaigner at the French nonprofit. It’s the latest study to raise questions around the extent to which ESG ETFs do good, amid research showing that such products can contain fossil fuels and even weapons. Meanwhile, the flow of cash into ESG ETFs is on the rise, with Bloomberg Intelligence predicting the market will hit $1.3 trillion by 2025.Reclaim Finance said most of Amundi’s passive funds, including those acquired as part of the Lyxor takeover, are not covered by the asset manager’s coal restrictions.Amundi, which is majority owned by Credit Agricole SA, said it plans to have 40% of its passive offering in ESG funds by 2025. In an emailed response to a request for comment, the asset manager referred to itself as a “leader in the management of ESG assets and a pioneer in responsible investment.”“As early as 2016, Amundi implemented an exclusion policy for coal,” it said. “This policy is regularly reinforced, in line with the commitments set out by the Credit Agricole Group. Amundi is thus pursuing a goal completely exiting from the sector by 2030 for OECD and by 2040 for the rest of the world.” Amundi said these targets apply to its “active management offering and our ESG ETF range for passive managemenr