The election of President Donald Trump accelerated the attacks on ESG. From November 5 through August 31 of 2025, our ESG stock picks averaged a 3.7% return, while the S&P 500 rose 14.3%. Doing good and making money are no contradiction with these ESG stock and fund picks that ride the trend of socially conscious investing. When circumstances go wrong, Clean Harbors is effectively a first responder for the environment and for overall social wellness.
NASDAQ: LRCX
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare. Nuveen ESG Mid-Cap Growth ETF (NUMG +0.53%) holds about 50 mid-sized, U.S.-based companies that are rapidly growing, as measured by projected earnings per share (EPS), historic EPS, and the historic growth of sales per share. However, like any investment, these funds also come with some risks that investors should consider before allocating capital.
ESG investing
- We then used Q data from Insider Monkey’s database to determine hedge fund ownership and narrowed the list to the 12 most widely held names.
- ESG screening is one more tool investors can use to do good while mitigating risk to long-term wealth.
- Though 80% of the fund is invested in high-quality securities, up to 20% can be high-yield debt.
For conscious investors, this means defining personal values and clear investment goals from the outset. Regular monitoring and review of investments are necessary, not only to track financial performance but also to ensure continued adherence to ethical and sustainability criteria. This proactive engagement transforms investing into a powerful tool for driving meaningful societal and environmental progress. It reflects a fundamental understanding that a company’s long-term viability is intrinsically linked to its sustainable practices. Societal and environmental issues are becoming increasingly important to stakeholders, investors, and consumers alike. This growing emphasis on sustainability and ethical conduct underscores a dual benefit for investors.
Conclusion: A Sustainable Future with ESG Investing
A company’s strong ESG performance is frequently indicative of its long-term business resilience. Effective management of ESG risks, as evaluated by these rating systems, often translates into operational efficiencies, better regulatory compliance, and enhanced stakeholder trust. For example, a company with robust environmental practices might face fewer regulatory fines or be less susceptible to supply chain disruptions caused by climate change.
That’s the story behind the rise in environmental, social, and corporate governance (ESG) investing over the past several years. Annually, net inflows to sustainability-focused funds from investors around the world have reached billions of dollars. Even within the realm of ESG investing, the fundamental principle of diversification remains paramount. Spreading investments across various asset classes and sectors is crucial for mitigating risk and enhancing potential returns. While ethical considerations may lead to the exclusion of certain industries or companies, limiting investment options too strictly can result in a less diversified portfolio, potentially increasing risk exposure. A balanced approach that integrates ESG criteria with sound diversification strategies is key to building a resilient and impactful portfolio.
Environmental steward: Microsoft
- As with other iShares funds, companies substantively involved in civilian firearms, controversial weapons, tobacco, thermal coal, and oil sands are ineligible for inclusion in this ETF.
- This commitment extends to a specific target of a 50.4% absolute reduction in Scope 1 and 2 GHG emissions by 2032 compared to 2021 levels.
- From an ESG perspective, Visa demonstrates a commitment to social responsibility through various initiatives.
- Industry-specific and extensively researched technical data (partially from exclusive partnerships).
- This is the most direct way to ensure that your investments align with your personal values.
Because the company depends such much on a healthy environment, it’s no surprise that BG ranks among the best esg stocks best ESG stocks to buy. According to its website, one of the Bunge’s initiatives involves reducing greenhouse gas emissions and unlocking opportunities for sustainable growth. It also launched a program to help accelerate regenerative agriculture.
By that, we’re talking about being profitable or accretive for the environment, rather than merely mitigating the damage done. Nuveen ESG Small-Cap ETF (NUSC -0.14%)invests in small-cap domestic companies with good ESG track records. The stocks are selected from the MSCI USA Small Cap Index, screened with exclusionary rules, and then ranked by their comparative ESG performances.
That would come out to 16.8% and 11% up, respectively, against the prior year. On the other hand, active funds are managed by professionals who select investments based on their own analysis. However, they have higher fees and often underperform their passive counterparts over time. You’ll also want to consider whether to invest in a passive or actively managed ESG fund. Passive funds are often low-cost index funds that track a specific ESG benchmark. They offer transparency and lower fees, but may be limited by the index’s rules and can’t adapt to rapidly changing market conditions.
If you’re interested in the financials of these ESG stocks, read our Edge Reports. For the seventh year in a row, in 2023, Infosys is listed on the Dow Jones Sustainability Indices (DJSI), a leading benchmark for corporate sustainability. To know more about the financials of this ESG stocks, read our Edge Reports. The above image clearly shows that as of 03rd January 2025, ESG stocks had outperformed the Nifty 50 over the past years, with a return of 15% compared to the Nifty 50’s 11%. Since its inception, Tata Motors has produced 150,000 EVs, and its net sales have grown by 26.58%.
These recognitions underscore a deep commitment to social responsibility and robust corporate governance. Accenture’s commitment to responsible business practices is reflected in its ESG assessments. S&P Global, for instance, evaluates Accenture’s performance and management of ESG risks, opportunities, and impacts relative to its industry peers. While specific details on Accenture’s direct ESG initiatives were not available in the provided materials, its S&P Global ESG Score indicates a strong standing within its sector.
Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. Adobe provides software, publishing, and cloud storage for creatives, along with marketing analytics tools for business teams. Xylem has established itself as a leader in the water infrastructure industry due to a history of acquisitions and an end-to-end portfolio of products to meet its customers’ needs. For consumers, Intuit offers subscription-based TurboTax and Credit Karma. Intuit serves businesses with its subscription-based accounting software QuickBooks.
It is a strategy that considers not just financial returns but also a company’s impact on the environment, society, and governance practices. It helps assess how a company’s operations impact the environment, culture, and internal governance. With ESG investing now more established, the focus has moved away from broad themes toward companies that can show measurable benefits from incorporating ESG into their business models.
Investing for good
In addition, the company has stressed its social equity initiatives, fostering an environment of diversity and inclusion. Second, Mastercard is attempting to merge the power of technology and the social need for equity together. Specifically, it wants everyone to participate in the digital economy, and is thus focused on connecting individuals to tools and resources that will enable them to reach prosperity. Finally, the credit services specialist is accelerating its efforts to promote a low carbon, regenerative economy. The fund tracks the TIAA ESG USA Mid-Cap Growth Index, which includes companies with high ESG scores and low carbon scores and that are not involved in controversial business activities. IShares ESG Aware 1-5 Year USD Corporate Bond ETF (SUSB -0.06%) holds investment-grade, U.S. dollar-denominated corporate bonds with maturities ranging from one to five years.
