- Despite the exponential growth in recent years, environmental, social and governance (ESG) investments are still very unclear and controversial, which makes it difficult to define what they mean.
- According to a study by the financial market data provider Refinitiv, the largest and best-known ESG funds invest most of their clients’ money in big technology companies like Google, Microsoft, Amazon, Apple and Facebook – companies with a low carbon footprint and high returns for shareholders.
- Some experts say this focus on carbon means that the financial market often ignores other ESG issues like data security and labor rights that big tech companies tend to miss out on.
- In Europe in particular, there are some initiatives to create rules and standards for ESG financial products. Currently, however, almost every company can be bundled in an ESG index and sold as sustainable.
The idea of responsible investing is not new. It was born in the 1970s with religious groups who didn’t want to see their money …