Sustainable Investing: Good for your Money and Society

With sustainable investing, you build wealth and contribute to a better world. New SFDR rules and investment funds make starting with sustainable investing easier than ever.

Good to know: investing always carries risks. You can lose part of your investment. Past performance is no guarantee for the future. The information in our articles is general and not personal investment advice.

 

What is Sustainable Investing?

Sustainable investing is an investment strategy where ecological, social, and governance factors, also known as ESG factors, are considered in your choice.

How Do You Check if an Investment is Sustainable?

The European Union has introduced regulations to increase transparency and prevent misuse of the word sustainable (greenwashing). This allows investors to make more conscious choices for investment funds and companies committed to a sustainable future.

Large companies report on a wide range of ESG topics, and these reports are verified by independent experts.

The managers of sustainable investment funds select companies based on their scores for all ESG factors. How sustainable these investment funds are is then determined according to European rules. There are three classes:

  • Grey, or investment funds according to Article 6 SFDR: These funds do not consider sustainability goals when choosing investments.
  • Light green, or investment funds according to Article 8 SFDR: These funds promote environmental or social objectives, such as reduced CO₂ emissions or equal treatment.
  • Dark green, or investment funds according to Article 9 SFDR: These are explicitly sustainability-focused investment funds. The requirements for a dark green fund are therefore very high for all ESG factors.

Whether a fund is grey, light green, or dark green, and under which article of the EU rules it falls, can be found in the Key Information Document (KID).

Why Choose Sustainable Investing?

  • You contribute to a better world.
  • You consciously exclude harmful sectors.
  • You invest in companies with a vision for the future.
  • You don’t miss out on returns.

Researchers from NYU Stern examined more than 1,000 studies on sustainable investing. In most cases (58%), they saw a positive effect on financial performance. Only 8% found a negative correlation.

Sustainable Index Investing

You can invest sustainably in indexes by investing in hundreds of sustainable companies at once through a fund. This way, you easily follow a broad stock market or stock index. You benefit from broad diversification, low costs, and less risk. By choosing only companies that meet sustainable criteria, you invest in forward-thinking businesses that align with your values.

Getting Started with Sustainable Investing

Research shows that sustainable investing yields at least as good a return as non-sustainable investing. So you can invest responsibly and make a good return at the same time.

In Europe, every fund must indicate how sustainable it is. UpToMore Fund is a light green fund that invests in ETFs that promote environmental or social characteristics.

Good to know: investing always carries risks. You can lose part of your investment. Past performance is no guarantee for the future. The information in our articles is general and not personal investment advice.

Questions about Sustainable Investing

Heeft duurzaam beleggen invloed op mijn rendement?

Er is geen eenduidig bewijs dat duurzaam beleggen structureel tot een hoger of lager rendement leidt. Onderzoek laat wisselende resultaten zien, afhankelijk van de markt en periode.

Let op: Beleggen brengt risico’s met zich mee. De waarde van je belegging kan stijgen of dalen en je kunt een deel van je inleg verliezen. Een historisch gemiddelde biedt geen garantie voor de toekomst.

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