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7 ESG Investing Ideas That Could Add to Your Wallet and to Your Soul

InvestorPlace Logo By Tezcan Gecgil of InvestorPlace | Slide 1 of 8: ESG investing considers a firm's environmental, social and governance factors in its investment philosophy. Despite the challenges posed by the novel coronavirus, 2020 has also seen many consumers as well as investors put values-based living and investing at the center of their actions. Today, we will introduce seven ESG stocks good for your wallet and your soul. In its most recent review of ESG investing, the Global Sustainable Investment Alliance (GSIA) reported that "Globally, sustainable investing assets in the five major markets stood at $30.7 trillion at the start of 2018, a 34% increase in two years." "From 2016 to 2018, the fastest growing region has been Japan, followed by Australia/New Zealand and Canada … The largest three regions -- based on the value of their sustainable investing assets -- were Europe, the United States and Japan." Put another way, ESG investing is not just a passing phase, but is here to stay and grow in the new decade. In recent years, the number of exchange-traded funds (ETFs) that focus on ESG stocks has also increased. Examples, include:  FlexShares STOXX Global ESG Impact Index Fund (BATS:ESGG)  iShares ESG Aware MSCI EAFE ETF (NASDAQ:ESGD)  SPDR SSGA Gender Diversity Index ETF (NYSEARCA:SHE)  Financial markets support a range of activities and trends in society. In ESG's early days, action against global warming and poor corporate governance provided the initial impetus behind ethical investing. But as consumers and society-at-large evolves, so does ESG investing. For instance, some investors may avoid "sin stocks" in industries such as alcohol, tobacco, gambling, or weapons. Other investors may make their political leanings parts of their portfolio decisions. In addition, other market participants may concentrate on human and animal rights as well as environmental protection issues. Like other investment strategies, investors can either buy individual stocks or index funds that meet their criteria. For instance MSCI ESG Research provides free-of-charge ESG data and ratings. Investors can enter a company's name on the website to see how a stock rates in terms of ESG criteria. The rating scale ranges from AAA (a "leader") to AA, A, BBB, BB, B, and finally CCC (a "laggard"). MSCI provides a similar rating for funds as well.      Url #1 is an external link. Please edit.      There are also other providers of ESG ratings, such as the FTSE4Good Index Series. The FTSE Russell website provides a comprehensive list of indexes. Another listing of investors is the Global 100, which lists the 100 most sustainable corporations in the world. It would be important to remember that each research provider is likely to have different methodology and criteria for listing businesses. However, if a business is at the top of one list, it generally has a high ranking on another one too. With that information, here are seven ESG stocks to consider for sustainable investing.   CNH Industrial (NYSE:CNHI)  Edwards Lifesciences (NYSE:EW)  Hasbro (NASDAQ:HAS)  Nextera Energy (NYSE:NEE)  Microsoft (NASDAQ:MSFT)  Owens Corning (NYSE:OC)  Prologis (NYSE:PLD)

Tools For ESG Investing

ESG investing considers a firm's environmental, social and governance factors in its investment philosophy. Despite the challenges posed by the novel coronavirus, 2020 has also seen many consumers as well as investors put values-based living and investing at the center of their actions. Today, we will introduce seven ESG stocks good for your wallet and your soul. In its most recent review of ESG investing, the Global Sustainable Investment Alliance (GSIA) reported that "Globally, sustainable investing assets in the five major markets stood at $30.7 trillion at the start of 2018, a 34% increase in two years." "From 2016 to 2018, the fastest growing region has been Japan, followed by Australia/New Zealand and Canada … The largest three regions -- based on the value of their sustainable investing assets -- were Europe, the United States and Japan." Put another way, ESG investing is not just a passing phase, but is here to stay and grow in the new decade. In recent years, the number of exchange-traded funds (ETFs) that focus on ESG stocks has also increased. Examples, include: FlexShares STOXX Global ESG Impact Index Fund (BATS:ESGG) iShares ESG Aware MSCI EAFE ETF (NASDAQ:ESGD) SPDR SSGA Gender Diversity Index ETF (NYSEARCA:SHE) Financial markets support a range of activities and trends in society. In ESG's early days, action against global warming and poor corporate governance provided the initial impetus behind ethical investing. But as consumers and society-at-large evolves, so does ESG investing. For instance, some investors may avoid "sin stocks" in industries such as alcohol, tobacco, gambling, or weapons. Other investors may make their political leanings parts of their portfolio decisions. In addition, other market participants may concentrate on human and animal rights as well as environmental protection issues. Like other investment strategies, investors can either buy individual stocks or index funds that meet their criteria. For instance MSCI ESG Research provides free-of-charge ESG data and ratings. Investors can enter a company's name on the website to see how a stock rates in terms of ESG criteria. The rating scale ranges from AAA (a "leader") to AA, A, BBB, BB, B, and finally CCC (a "laggard"). MSCI provides a similar rating for funds as well.
  • Url #1 is an external link. Please edit.
There are also other providers of ESG ratings, such as the FTSE4Good Index Series. The FTSE Russell website provides a comprehensive list of indexes. Another listing of investors is the Global 100, which lists the 100 most sustainable corporations in the world. It would be important to remember that each research provider is likely to have different methodology and criteria for listing businesses. However, if a business is at the top of one list, it generally has a high ranking on another one too.

With that information, here are seven ESG stocks to consider for sustainable investing.

CNH Industrial (NYSE:CNHI) Edwards Lifesciences (NYSE:EW) Hasbro (NASDAQ:HAS) Nextera Energy (NYSE:NEE) Microsoft (NASDAQ:MSFT) Owens Corning (NYSE:OC) Prologis (NYSE:PLD)
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