How to shift to environmentally conscious investments
Investors looking to reduce their portfolios’ reliance on fossil fuels have numerous options, including green funds and direct indexing, which often perform as well as traditional investments.
Tara Siegel Bernard reports for The New York Times.
In short:
- Many investment funds exclude fossil fuel companies, and over the past decade, these funds have performed comparably or better than traditional ones.
- Tools like Fossil Free Funds and Morningstar Direct help investors analyze their current holdings and explore greener alternatives.
- Options such as ESG funds, index funds and direct indexing allow for customized investments that avoid fossil fuel-related companies.
Key quote:
“The No. 1 thing is to figure out what you own. But frankly, Wall Street doesn’t really want you to know. It is very hard to change when you are profiting from the current system.”
— Andrew Behar, CEO of environmental advocacy group As You Sow.
Why this matters:
Investing in environmentally conscious funds aligns portfolios with efforts to combat climate change, avoiding the financial support of industries that contribute heavily to global warming. It also provides individuals with opportunities to advocate for workplace options like ESG funds in retirement plans.
