Getting Started with Identifying Sustainable Investment Funds

Sustainable investing means directing your investments to companies promoting corporate responsibility, while combating environmental destruction, climate change, promoting animal welfare, and supporting other environmentally focused causes. As you get deeper into this investment strategy, you will start to ask: Which sustainable investment funds should you choose? Which funds are legit and how can you tell if that fund is suitable for you? 

Before you identify sustainable investment funds, keep in mind that sustainable investing is a form of an overarching investment approach that encompasses the ESG (environmental, social, and corporate governance) criteria throughout its process. Here’s a brief overview of some of the ESG criteria: 

• Environmental – Energy efficiency, carbon emissions, waste management, water scarcity, and pollution mitigation

• Social – Labour standards, workplace policies and diversity, product usefulness and safety, supply chain management, community impact, and customer privacy

• Corporate governance – Strategic sustainability oversight, executive compensation, bribery and corruption policies and oversight, board composition, political contributions and lobbying, and board structure

Types of sustainable investment funds

• ESG consideration funds – Many funds have prospectuses stating that ESG factors are an aspect of their investment processes. However, they usually do not apply impact analysis, exclusionary screens, and shareholder engagement in their processes.

• ESG focus funds – Unlike consideration funds, these are the funds with sustainability factors that are critical to their process for portfolio construction and security selection.

• Impact funds – These are focused on broad sustainability and delivering environmental or social impact with financial returns. These are the sustainable investment funds focused on specific subjects, such as gender equity, low carbon, green bonds, and the like.

• Sustainable sector funds – These funds are focused on company stocks, which they aim to benefit from and contribute to, particularly in transitioning to a green economy. The areas include environmental services, energy efficiency, renewables, green real estate, and water. 

Which sustainable investment funds should you pick? The answer depends on your personal beliefs, morals, and values. You may want to consider working with an investment company that is focused on the investment opportunities offered by the modern foods industry, particularly those seeking environmentally friendly alternatives to meat.


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