What is ESG investing?
ESG – or Environmental, Social and Governance – is a term we hear all the time when it comes to investing at the moment. But actually, ESG factors are only a part of the wider responsible investing world. Here we aim to explain some of the terminology and why our products are more than just ESG.
Traditional investing vs responsible investing
Let’s start by looking at how responsible investing fits with the traditional investing many are more familiar with.
From this, we can see that responsible investing means ruling out investing in some companies. But which companies? This depends on the type of responsible investing involved.
The responsible investing spectrum
At 7IM, we consider there to be four main approaches that fall within the term responsible investing. These sit within a spectrum of increasing levels of screening.
How might these areas look in an investment portfolio?
Our approach to responsible investing
At 7IM, we use a blend of investments from across the responsible investing spectrum in our solutions.
Our approach means:
And this is all without sacrificing returns compared to traditional investments, and while remaining true to our belief that being highly diversified is critical to successful investing.