Displaying items by tag: carbon

ESG and other socially conscious investing is all fine and dandy when energy prices are modest, however the sharp spike in energy has many reorganizing their priorities. There was already an upward trajectory pre-Russian invasion due to OPEC+ supply constraints but that has escalated with Biden’s latest sanctions. The war is putting pressure on key commodities that are slowing many green energy initiatives and renewable policy proposals. More Americans than ever are worried about the prices at the pumps and calling for expansion in drilling to expand supply. So no matter the political pressure ESG is facing an uphill climb at the moment.

Finsum: This could put more pressure on long term green energy proposals as this crisis highlights dependence on fossil fuels.

ESG ETFs continue a fire streak and every single Wallstreet mainstay is launching funds as fast as they can. Goldman launched their latest fund this week Goldman Sachs Bloomberg Clean Energy Equity ETF which will be traded with the ticker GCLN. It will hopefully capitalize on the US transition to clean energy with a strong focus on equities. ESG has a strong track record as last year 13 ESG index funds with large caps crushed the S&P 500 with an almost 30% return. Goldman thinks the ESG movement is just in its infancy and this fund is a long-term strategy.

Finsum: The rapid growth in ESG funds is starting to teeter on bubble territory, but that bubble could pop a long time from now.

ESG has been one of the fastest-growing stories of 2021 and has taken over every other headline with it. However, things could be shifting in 2022 for ESG, and fund leaders see things shifting for ESG in 2022. The first big area of change will be talent and analysts more catered to addressing and differentiating ESG content. Investors will also face greater scrutiny from compliance officials and regulators, and language will be more cautious moving forwarded. Finally, investors themselves will definitely demand more than just a green label, but rather specifics of how companies are meeting and leading the way in ESG.

FINSUM: If 2021 was the year of explosion in ESG and impact investing, 2022 will be marked by how regulators tightened the reigns on this explosive industry.

Investors are doubling down efforts to carry out specific reviews of companies ESG compliance, as a new survey found that 72% carry out reviews compared to a meager 32% a couple of years ago. Some stocks are standing out from the crowd as good ESG investments moving forward. Microsoft stands out by their detailed yearly reports that will stand up to scrutiny and their pledges to reduce their carbon footprint seem very plausible. The next big stock is Nvidia which has one of the highest ESG ratings in the chip manufacturing industry and GPU and other chip demand will only grow moving forward. Dividend darling Coca-Cola should also be on investor’s radar as it has a long positive history of supporting sustainable initiatives. Rounding out the best picks is American Express which has an AA rating on ESG efforts putting it in the industry's 93 percentile.

FINSUM: Stock pickers should look out for consistent ESG benchmarks as this will likely lead to outperformance moving forward.

The advancement of clean technology is critical to meeting the Paris Agreement goal of net-zero energy...See More