ESG funds rode a massive wave of inflows back in 2021, when they pulled in $645 billion globally. But the landscape shifted dramatically. What was once a hot trend everywhere has now reversed course—and hard. In 2025, we're seeing record outflows hitting $11.8 billion as investors reassess their priorities. The momentum that seemed unstoppable just a few years ago has basically evaporated. It's a stark reminder that even supposedly unstoppable investment trends can flip when market conditions and investor sentiment change. Those betting on ESG as a permanent fixture might want to pay closer attention to what's actually happening with their capital allocation.