Dec. 27 Report: ESG ETFs Index UP +27.2% YTD
Our (non-trading) "ESG Index" identifies the top 16 (out of 33) ESG ETFs, their ESG scores, and their performances YTD.
The three core pillars of the ESG investing philosophy are:
- Environment:
- How does a company manage its environmental impact?
- How much progress has it made in utilizing renewable energy sources?
- Is it attempting to minimize its carbon footprint?
- How does it handle air or water pollution arising from its operations?
- What is its attitude toward climate change?
- What about sustainability efforts in its supply chain?
- Social:
- How does the company improve its social impact?
- Does it offer fair levels of compensation for employees?
- What are its policies regarding LGBTQ+ equality, racial diversity and inclusive hiring practices?
- How does a company advocate for social good in the wider world, beyond its limited sphere of business?
- Governance:
- How do management and the board of directors address the interests of the company’s employees, shareholders, and customers?
- Is executive compensation balanced compared to pay for other employees?
- How does the company’s board and management drive positive change?
- Does the board foster diversity in leadership?
- Are its interactions with shareholders positive?
Each ESG ETF has an ESG score; a good ESG rating (the higher the better) means a company is managing its environment, social, and governance risks well relative to its peers. Investors who use ESG ratings to supplement financial analysis can gain a broader view of a company's long-term potential.
The list of the top 16 ESG ETFs below has hyperlinks to 3 areas of additional information which are imperative for any individual considering investing in the ESG sector.
- The fund name is hyperlinked to provide you with a description of the fund and an analysis of its stock.
- The trading symbol is hyperlinked to additional financial data and commentary on the company (where available).
- The percentage increase YTD is hyperlinked to a chart of the company's stock performance YTD.
Below are their performances YTD in descending order and their respective ESG scores:
- iShares ESG MSCI USA Leaders ETF (SUSL): +33.4% YTD; ESG Score: 7.5
- SPDR® S&P 500® ESG ETF (EFIV): +30.6% YTD; ESG score: 8.4
- Xtrackers MSCI USA ESG Leaders Equity ETF (USSG): +30.6% YTD; ESG Score: 6.4
- Xtrackers S&P 500 ESG ETF (SNPE): +30.5% YTD; ESG Score: 6.5
- IQ Candriam ESG US Equity ETF (IQSU): +29.5% YTD; ESG Score: N/A
- MSCI USA ESG Select ETF (SUSA): +28.9% YTD; ESG Score: 6.6
- Nuveen ESG Mid-Cap Value ETF (NUMV): +28.6% YTD; ESG Score: 7.2
- FlexShares STOXX US ESG Select ETF (ESG): +27.6% YTD; ESG Score: N/A
- Nuveen ESG Large-Cap Growth ETF (NULG): +27.3% YTD; ESG Score: 6.0
- WisdomTree U.S. ESG ETF (RESP): +26.0% YTD; ESG Score: N/A
- iShares ESG MSCI USA ETF (ESGU): +25.8% YTD; ESG Score: 6.5
- iShares ESG Advanced MSCI USA ETF (USXF): +25.7% YTD; ESG Score: N/A
- Vanguard ESG U.S. Stock ETF (ESGV): +25.7% YTD; ESG Score: 6.8
- Nuveen ESG Large-Cap ETF (NULC): +24.4% YTD; ESG Score: 8.4
- ClearBridge Large Cap Growth ESG ETF (LRGE): +22.7% YTD; ESG Score: N/A
- Nuveen ESG Large-Cap Value ETF (NULV): +21.4% YTD; ESG Score: 7.7
The above 16 ESG ETFs are UP +27.2% YTD, on average, with an average ESG score of 7.1. See previous performance here.
In addition to the 16 ESG ETFs analyzed above there are 17 other ESG ETFs with YTD performances of less than 20%, namely, by trading symbol: ESML, NUSC, NUMG, IQSI, ESGD, DMXF, NUDM, VSGX, EMXF, RESE, LDEM, NUEM, SUSC, ESGE, KESG, SDG and ICLN.
There are also 9 fossil-free ETFs, 7 low carbon and climate transmission ETFs, and 23 clean energy ETFs but none of them incorporate social or governance factors, so, as such, they were excluded from consideration in this analysis.
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