Exchange traded funds and other strategies that incorporate Economic, Social and Governance, or ESG, principles have been quickly gaining traction as a way to help investors align portfolio investments with their core values and still achieve long-term goals.
ETF Trends publisher Tom Lydon spoke with Brian Diessner, Senior VP and Head of Sales at Global X, at the Inside ETFs conference that ran Jan. 22-25, 2017 to talk about increasingly popular socially responsible and ESG-centric investment strategies as a core portfolio position.
“Broadly people can think about it in different buckets of impact investing in things like water and a lot of other direct investments, and then you’ve got socially responsible investing, SRI, ESG – environmental, social, governance – as well as another category that we think of at Global X: values-based investing,” Diessner said.
For example, the Global X Conscious Companies ETF (NasdaqGM: KRMA) tries to reflect the performance of the Concinnity Conscious Companies Index, which tracks companies that achieve financial performance in a sustainable and responsible manner and exhibit positive ESG characteristics.
“Bottom line is it’s finding investments that align with the interests and passions of the ultimate end investor,” Diessner said.
Some may question the up-and-coming theme as either a passing fad, but more are warming up to ESG and socially responsible investments as a sustainable long-term strategy.
“Investors don’t need to sacrifice returns in building portfolios that align with their values,” Diessner said.