The question of whether investing in companies or businesses which work to provide products and services in a sustainable or environmentally friendly fashion is a positive move is difficult to question; the rise of sustainability-focused funds in recent years is a testament to the rising investor-driven demand for such products.
Indeed, investing in many of the largest and most prominent sustainability-focused exchange traded funds (ETFs) have produced very reasonable returns for investors in recent years. For example, the Neuberger Berman Sustainability Index (NYSE:NBSLX) has performed extremely well for investors over the past 15 years, providing said investors with an annualized return of 9.59% each and every year, beating the S&P 500 over that time frame (albeit by a very slim margin of five basis points).
The idea that sustainable investing can be good for society, the environment, the social good, and an investor’s pocket book is starting to gain traction.
While other investments in tobacco companies or gun manufacturers have represented traditionally high levels of profitability despite very negative public sentiment and perceptions of negative social impact, balancing which investments can (or should) go into one’s portfolio on the basis of return alone is an interesting discussion for another day.
As far as ETFs go, investing in the tried and true would certainly be my take within the sustainability arena. The Neuberger Berman Sustainability Index has shown it can both bring home the bacon, and do it in a positive way, a win-win for investors looking for such an option.
Invest wisely, my friends.
