Dive into ESG and Sustainable Equity Mutual Fund Investments
A Deeper Look into ESG & Sustainable Investments
Benefits of ESG & Sustainable Equity Mutual Fund Investments
- Positive Environmental Contribution
- Social Responsibility
- Ethical Risk Management
- Attractive Investment Performance Potential
Currently, ESG-based (Environmental, Social, Governance) Equity Mutual Fund investments are gaining popularity and catching the attention of investors. Many experts believe that this type of investment can be a solution to market development challenges and sustainability issues.
If you are considering investing, ESG-based investments might be worth exploring. To learn more about ESG Mutual Fund investments, keep reading!
A Deeper Look into ESG & Sustainable Investments
ESG and sustainable investing allow you to make a positive environmental and social impact while growing your investments. There are many investment options, one of which is ESG-based Mutual Funds.
In simple terms, ESG investing means putting your money into assets that adhere to sustainable values. For instance, if you invest in an ESG-themed Mutual Fund, the portfolio you select will include investments that focus on ESG principles.
The outlook for ESG and sustainable investment is becoming a trend, especially from a risk management perspective. Investors choose ESG investments to avoid controversial practices, as more young and experienced investors are becoming aware of sustainability issues, such as climate change and the commitment to net-zero emissions. So, what are the goals or criteria of ESG investment? You can find the discussion below.
Objectives of ESG Investments
It's important to know/ understand that ESG-based Equity are not solely focused on profit but also on the benefits for the environment, society, and governance.
When companies adopt ESG investment themes, their long-term value can increase significantly. If you're keen on ESG-themed investments, here are the key objectives of ESG investments:
- Environmental Goals
Environmental goals focus on ensuring that investments contribute to nature conservation during their operations. This includes selecting portfolios that engage in environmentally friendly practices, such as effective waste management or pollution reduction.
Companies with good environmental practices are ideal for ESG and sustainable investment portfolios.
- Social Goals
Social goals in ESG investments examine how the company interacts with society, customers, the media, and other external parties. As an investor, it’s important to understand how the company manages social issues, such as transparency in fulfilling the expectations of investors and stakeholders.
- Governance Goals
The third pillar of ESG is governance. This aspect focuses on the company’s management, including transparency, work culture, external relations, and audit processes.
Strong governance builds investor confidence by promoting transparency, legality, and ethical standards in financial management.
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Benefits of ESG & Sustainable Equity Mutual Fund Investments
After understanding the goals of ESG and sustainable investments, here are some of the benefits you can gain from choosing this type of investment:
- Long-Term Investment Goals
When choosing an investment, you naturally hope it has the potential for strong returns and continuous growth. One of the key benefits of ESG investments you might consider is their suitability for long-term investment.
With the current trend towards ESG investing, you are better positioned to face financial market risks and changes. This increases the potential for your investment to keep growing over time.
- Positive Environmental Contribution
Investment should not only focus on returns and profits. A good investment is one that also makes a positive impact on the environment. For example, with the worsening climate conditions, your investment can contribute to environmental preservation.
- Social Responsibility
Social responsibility is another benefit of ESG investments that you can experience. The social contribution and responsibility of an investment can be seen in ensuring worker welfare.
Additionally, maintaining good relations between investors, companies, and local communities is another proof of social responsibility. If this can be sustained, the potential for the stability of your investment will also improve.
- Ethical Risk Management
Another benefit of ESG Mutual Fund investments is risk management based on ethics. Essentially, the ethical point here ties together all the previous points.
When you invest with ethically-based risk management, all the factors above are interconnected. The goal, in addition to achieving the best possible returns, is also to create a positive image for society, the environment, and the community.
- Attractive Investment Performance Potential
Finally, it’s important to understand that companies implementing ESG principles tend to be more operationally efficient. If a company is operating efficiently, it means investors are likely to reap greater benefits compared to traditional investment types.
This refers to higher potential returns compared to non-ESG investments. The reason is that when you choose ESG and sustainable investments, the social, environmental, and community responsibilities are better managed. This, in turn, creates a positive image, which ultimately impacts the value of the investment.
That concludes the in-depth discussion about ESG and sustainable investing. Equity Mutual Funds are one type of investment where products can adopt an ESG-based approach.
Some of the ESG investment products available from DBS Treasures, accessible through the digibank by DBS Application, include:
- BNP Paribas Sri Kehati
- Allianz Sri Kehati Index Fund
- Ashmore Digital Equity Sustainable Fund
- BNP Paribas Indonesia ESG Equity
- Eastspring IDX ESG Leaders Plus
- Batavia Global ESG Sharia Equity USD
In addition to ESG and sustainable investments that help build a positive image in the eyes of the public, DBS Treasures also offers product advantages that you can experience.
First, the investment risk is minimized, as it is managed with diversification by professional Investment Managers. Second, you will receive valuable investment insights to guide you toward better investment decisions.
You will be supported by curated market analysis from a team of financial experts who will communicate it. Seize the latest opportunities that have been tailored to your risk profile and portfolio needs, driven by Artificial Intelligence/Machine Learning (AI-ML). This insight is equipped with curated solutions related to investment (Grow) and insurance (Protect), so you can quickly and confidently invest through your preferred media.
A variety of activities, including buying, selling, switching, and SID registration, can be easily managed through the digibank by DBS Application.
Therefore, choose ESG and sustainable Equity Mutual Fund investments from DBS Treasures. Not only will you be aligned with the latest trends, but you’ll also have the opportunity to gain optimal returns. Click here for more detailed information!
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