- Can you really change the world—or even the behavior of a single company—with your own personal investments?
- How do you know what makes a legitimate ESG investment?
- Can you get the kind of returns you need to buy a home or send your kids (or your future kids) to college or to be able to retire and cover your expenses when you no longer can or want to work?
Engine No. 1 argued that the company’s share price was underperforming its peers because the company was unprepared for the transition away from fossil fuels. It nominated candidates for the board that would push the oil giant to embrace renewable energy. Against all odds, holding just .02% of the company’s stock, Engine No. 1 prevailed. “But,” he adds, “a really important part of the options available to investors is the ability to move our money where our values are, and ESG funds can play a large role in that.”“Every single cent counts,” says Anny Giavelli, a sustainable investment strategist at Ecofin in London, which offers its own ETFs and other funds focused on sustainability. The best way to make those cents count, says Giavelli, is by investing in funds that have active ESG strategies that align with the change you’d like to see in the world: close the male-female wage gap? Cut carbon emissions? Promote better wages for farm workers? Save the world’s water resources? There’s a fund for that. While you could pull out all kinds of socially responsible investing indexes and do your own analysis to see how companies’ claims stack up against some of the major ESGs and benchmarks, with nearly 6,000 companies trading just on the New York Stock Exchange and the Nasdaq, and the paucity of deep-dive data available for retail investors, you can end up down some deep rabbit holes. The best thing to do, says fund managers and advisers active in the ESG space, is to stick with ETFs or investment funds managed by well-known, reliable fund managers, who specialize in the form of ESG that you care about.
“A really important part of the options available to investors is the ability to move our money where our values are…”