Exchange Traded Funds for ESG Investors

Introduction: The selected ESG investing choices included here are the most popular ETFs evaluated by AFIEA (Advisory for Financial Innovation, Evaluation, and Assessment). Please note that ESG investors may also consider using ESG mutual funds from firms such as Parnassus and IMPAX as ETF alternatives. ESG investors should consider ETFs or mutual funds based solely on financial considerations relevant to the risk-adjusted economic value of a particular ESG investment.

Common Types of Sustainable Investing

  • Socially responsible investing (SRI) involves screening investments to exclude businesses that conflict with investor values. Examples include avoiding stocks that generate revenue from tobacco, fossil fuels, firearms, or gambling.
  • Environmental, social and corporate governance (ESG) investing involves incorporating extra-financial factors into the investment decision-making.
  • Impact investing involves a direct connection between an investor’s values and the use of their capital. Here, investors aim to have both a positive social impact and generate good financial performance.
  • Shared value investing is profit-driven investing which creates tangible societal benefits. It recognizes economic benefits that often come from the social impact that improves shareholder returns.

AFIEA's Choice: The Best ETF Family of ESG Investing

  • Sustainable investing is about recognizing companies solving ESG challenges for better growth. It is about pioneering better ways of doing business and creating momentum to encourage more people to create a sustainable future. In practice, sustainable investing combines traditional investment approaches with environmental, social, and governance (ESG) insights.
  • Sustainable investing allows investors to align investment decisions with personal beliefs. It is on the rise, evidenced by the growth of sustainable exchange-traded funds (ETFs). iShares by BlackRock is committed to being an industry leader in sustainable investing.
  • iShares ESG ETFs provide exposure to quality companies that manage sustainability risks well. Still, careful research is required to make sure the selected ETF reflecting the value of ESG investing.
Investors no longer need to choose between purpose and performance. Some sustainable ETFs seek similar risks and returns as broad markets. ESG criteria reveal risks and opportunities that are not apparent in traditional financial analysis. ​

Other Companies with ESG Investing ETFs

Invesco

Invesco provides ESG investors with the benefits of ETFs without giving up engagement. Its ETFs actively vote on company proxies. The ESG ETFs range includes core equity, multi-factor equity, fixed income, and commodities.

SPDR

There is no one-size-fits-all approach to ESG investing. SPDR experts thoughtfully craft ETFs to meet its clients’ evolving needs so they can pursue the value that ESG investing can add to portfolios.

Vanguard

Vanguard ESG funds invest in stocks and bonds with differing investment styles and objectives. Most of its funds are indexed and follow an exclusionary strategy that omits companies that don't meet certain ESG criteria.

PIMCO

PIMCO manages a range of ESG-focused ETFs, mutual funds, and separate accounts founded on the belief that it’s possible to achieve both attractive financial returns and positive change, including its Climate Bond Strategy.

Nuveen

 Nuveen helps seeking growth with positive impact. Its ESG model growth portfolios offer a broad range of diversified allocations with potential for attractive long-term total return and exposure to responsible investments.

DWS Xtrackers

DWS Xtrackers ESG ETF suite delivers ESG solutions across core benchmarks for investors. Sustainability is one of DWS’s core foundational values and Xtrackers offers an innovative lineup of ESG products.

Northern Trust

Northern Trust manages the FlexShares STOXX US ESG Impact Index Fund (ESG). It focuses on the analysis of disclosed ESG data in an attempt to provide a more diversified, ESG tilted core equity investment portfolio.

WisdomTree

The WisdomTree U.S. ESG Fund (RESP) seeks to achieve its investment objective by integrating factor-based investing with U.S. companies who screen favorably on environmental, social and governance ESG standards.

Global X

The Global X Conscious Companies ETF (KRMA) invests in well-managed companies that achieve financial performance in a sustainable and responsible manner and exhibit positive ESG characteristics.
Disclaimers: ESGStandard.com contents are carefully selected by AFIEA from public domains for research purpose only. All results, statements, and statistics are believed to be reliable but are not guaranteed as to accuracy, timeliness, or completeness. We do not endorse, recommend, or comment any specific financial firms and/or their products or services. The past performance cannot guarantee its future performance. You bear full responsibility for own investment decisions which may be influenced by research or information published on this site. You also agree that our content source publishers will not be liable for any investment decision made or action taken by you.
Copyright: All Information available through this site may be protected by copyright and intellectual property laws. All rights are reserved by the original content source providers. You may not reproduce, re-transmit, disseminate, sell, publish, broadcast, nor shall the Information be used in connection with creating, promoting, trading, marketing investment products without the express written consent of the original source providers. You are entitled to use the Information it contains for your research and non-commercial use only.
AFIEA - Systematic Investment Research and Education since 1996