Despite years of misgivings, ESG investing is gaining in popularity. It's not just for tree huggers anymore!
For many years, investors were concerned by the limited number of ESG funds and felt they were a drag on performance.
Research by the folks at Investment News shows that times are changing.
ESG funds are not only gaining in popularity, but they're starting to show up in more traditional mainstream firms as they embrace responsible investment strategies.
In earlier years, ESG meant simply screening out companies involved in less desirable practices. The financial services industry has begun to dig deeper to explore what ESG ratings show about a potential company as an investment. Some are noticing that companies with good governance and environmental sustainability have better performance in the long run.
While not all are embracing ESG investing as according to recent Investment News surveys, The Forum for Sustainable and Responsible Investment (US SIF) shows the industry continues to boom with over $8 trillion in SRI assets in 2016.
Despite the reluctance of some, it seems not only are ESG investments here to stay, but they will continue to rise in popularity.