Total assets overseen by ethical investment funds on behalf of Australian investors leapt 30 per cent in 2020 to be worth $1.28 trillion, accounting for 40 cents of every professionally managed dollar.

The inflow of capital came at the expense of the unconstrained managed funds market, which saw the value of its assets shrink by 11 per cent, or $234 billion, to $1.91 trillion, according to the latest report released by the Responsible Investment Association Australasia (RIAA) in collaboration with KPMG.