The 10 biggest actively managed ESG funds tracked by Morningstar reported an average 9.2% loss in January, much steeper than the 5.3% drop in both the S&P500 .SPX and MSCI World MIWO00000PUS indices. Across Europe, more than 500 funds were repurposed in 2021, data from industry tracker Morningstar showed and almost 40% of EU-based assets are now classified as sustainable. Some ESG fund managers have already sought refuge in sectors which provide a hedge against inflation while being friendlier to the environment, such as real estate, Bank of America analysts said in a note to clients.