The Nasdaq-100 Index (NDX) is one of the most widely observed equity benchmarks in the world, and it’s been a favorite of asset allocators and investors for decades, due in part to its above-average exposure to innovative companies.

NDX also serves as the underlying index for some well-known exchange traded funds, including the Invesco QQQ Trust (QQQ) and the Invesco NASDAQ 100 ETF (QQQM), QQQ’s cost-efficient cousin.

Highlighting the versatility of NDX, a pair of new ETFs leverage the index to bring investors environmental, social, and governance (ESG)-inspired plays on the benchmark. One of those rookie ETFs is the Invesco ESG NASDAQ 100 ETF (QQMG), which debuted in late October.

QQMG follows the Nasdaq-100 ESG Index, which, as its name implies, is the ESG spin on NDX. The requirements for admittance into the Nasdaq-100 ESG Index are easily understandable for investors.

“To satisfy the ESG criteria, an issuer must not be involved in certain specific business activities, such as alcohol, cannabis, controversial weapons, gambling, military weapons, nuclear power, oil & gas, and tobacco. Additionally, an issuer must be deemed compliant with the United Nations Global Compact principles, meet business controversy level requirements, and have an ESG Risk Rating Score that meets the requirements for inclusion in the Index,” according to Invesco.

Proving that NDX is already home to plenty of companies that score well in ESG terms, the new QQMG holds 96 stocks, according to issuer data.

Still, QQMG is relevant at a time when investors are increasingly concerned about greenwashing. One form of greenwashing is an issuer applying the ESG label to a fund that’s not dedicated to that purpose simply because a few of its holdings are legitimately ESG-friendly. In the face of this, investors and regulators are applying more scrutiny to fund labels, and QQMG doesn’t purport to be something it’s not. That’s a good thing.

The new ETF is also an ideal avenue for investors looking to marry growth stocks and ESG. Like the standard version of the Nasdaq-100, QQMG is heavy on technology stocks. In fact, QQMG is overweight to that sector relative to NDX with a 61.1% allocation. Communication services and consumer discretionary names combine for 27.67% of the fund’s roster.

As for specific holdings that are sound EGS stewards, Microsoft (NASDAQ:MSFT) and Apple (NASDAQ:AAPL) combine for 27.8% of QQMG’s weight.

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The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.