ESG and Sustainable Investing Strategies for Long-Term Success

Investing in companies that prioritize Environmental, Social, and Governance (ESG) factors can lead to long-term financial success, as seen in the case of companies like Unilever and Patagonia, which have consistently outperformed their peers.

Research has shown that ESG investing can reduce portfolio risk and increase returns, with a study by the Harvard Business Review finding that ESG funds outperformed non-ESG funds by 4.7% per year from 2015 to 2019.

Incorporating ESG criteria into investment decisions can also help mitigate potential risks, such as climate change and social unrest, which can have significant financial impacts on companies and investors.

By adopting ESG and sustainable investing strategies, investors can align their investments with their values and contribute to a more sustainable future.

ESG and sustainable investing are strategies that focus on environmental, social, and governance objectives. ESG stands for environmental, social, and governance.

Environmental considerations include water use, land use, waste management, and climate risk. Investing sustainably can be simple.

The goal of ESG investing is to select investments based on their environmental, social, and governance performance. For illustrative purposes only.

Investors can get started with sustainable investing by visiting a starter kit page for guidance. This is not an exhaustive list of ESG considerations.

Sustainable investing can be done as easily as traditional investing. Visit Advisor Center for an in-depth look at sustainable investing if you are a financial professional.

Sustainable investing options are available through professionally managed investments like mutual funds and exchange-traded funds (ETFs), which incorporate ESG considerations into their process.

Many traditional funds prioritize financial return over ESG considerations, but some may choose to integrate ESG considerations to the extent it is financially material to the investment decision.

You can achieve a more direct intent with a sustainable thematic or impact strategy, which targets an environmental or social issue, such as renewable energy, and may take precedence over financial returns.

Sustainable thematic strategies are broad and diversified, while impact investments prioritize the impact of a single objective or project, such as clean water or affordable housing, over the financial return of that investment.

Climate investing capabilities have been developed to meet the needs of investors who wish to address climate change, with a range of equity and fixed income solutions and tools designed to measure and manage exposure to climate risk.

You can find a sustainable fund that aligns with your investment goals by selecting your primary investment goal and exploring the corresponding fund range, or by filtering all sustainable funds using your own criteria.

Sustainable investing can be simple, and investing in environmental themes such as water use, land use, and waste management can be a good starting point, as well as considering climate risk.

iSHARES offers strategies that focus on environmental, social, and governance (ESG) objectives, and you can get started with sustainable investing by visiting the starter kit page or Advisor Center for guidance.

Principal issued a $600 million sustainability bond in August 2021 to finance eligible social and environmental assets, such as affordable housing and renewable energy.

The bond's proceeds were allocated to various categories, including energy efficiency and green buildings, and are disclosed in Principal's Sustainable Financing Report.

To govern the process for this bond and future issues, Principal created the Principal Sustainable Financing Framework, which defines criteria for eligible assets and aligns with the United Nations Sustainable Development Goals (U.N. SDGs).

Approximately 61% of individuals received training on sustainable investing topics.

The Framework requires that 90% or more of a business's revenue comes from activities and criteria that align with U.N. SDGs.

State Street Global Advisors offers a range of equity and fixed income solutions to help investors address climate change.

Sustainable thematic strategies focus on specific investment themes, such as renewable energy, and may prioritize environmental or social goals over financial returns.

Impact investments prioritize a single objective or project, like clean water or affordable housing, over financial return.

Investors can find sustainable thematic mutual funds, ETFs, and individual securities at Edward Jones.

Sustainable investing requires tools to measure, manage, and disclose the challenges and opportunities within an investment portfolio.

Our sustainability and research platform includes multiple data sets from various data providers, covering topics like sustainability ratings, climate risk, and corporate governance.

BlackRock offers investment stewardship, engaging with companies to promote sound corporate governance and durable, long-term financial value creation.

For investors seeking to align with the Paris Agreement and achieve net zero emissions, BlackRock offers climate-aware investment solutions and comprehensive reports to identify climate-related risks and opportunities.

Investors can find a fund that aligns with their investment goals by selecting a primary goal and exploring the corresponding fund range.

The U.S. Inflation Reduction Act may lead to trillions of dollars spent on modernizing infrastructure, with a significant portion going to environmental infrastructure solutions like energy efficiency.

Clean energy is becoming a core component of global power infrastructure, with potential growth ahead, making it an attractive investment opportunity.

Next-generation environmental technologies may be increasingly important in the economy, with three key reasons supporting this trend.

State Street Global Advisors offers a range of equity and fixed income solutions to help investors address climate change.

Their Asset Stewardship program aims to promote effective board oversight, disclosures, and shareholder protection through voting at shareholder meetings and engaging with companies.

Investors should note that excluding companies that don't meet sustainable investment criteria may result in lower returns compared to a portfolio that includes such companies.

State Street Global Advisors engages with companies to inform their voting and promote sound corporate governance that is consistent with durable, long-term financial value creation for their clients.

Their Funds are distributed by BlackRock Investments, LLC, and certain information is provided by MSCI ESG Research LLC.

MSCI ESG Research LLC has established an information barrier between equity index research and certain information, and none of the information in and of itself can be used to determine which securities to buy or sell.

Here are some key points about State Street Global Advisors' investment and stewardship approach: