ESG Investing: Understanding Sustainable Funds and Initiatives.
ESG investing, which takes into account environmental, social, and governance factors, has become a popular investment strategy, with sustainable investments accounting for $8.4 trillion in assets under management in the US. Sustainable funds can fall into three categories: socially responsible funds, ESG funds, and impact funds. While the SEC is proposing regulations to make it easier to understand what a particular fund holds, investors should still do their homework and ensure that any sustainable investment aligns with their investment goals.