For several decades environmental, social and governance (ESG) investing was chiefly regarded as a way to satisfy the conscience of certain investors while hopefully not doing too much damage to returns. However, over recent years attitudes have begun to change.
With ESG regulation and public awareness increasing sharply, capital is flowing away from high ESG-risk companies and to those that stand to benefit from a changing landscape. Encouraging this shift is more sophisticated reporting and interpretation of ESG data along with a growing belief that an ESG focus can actually improve shareholder returns. So, regardless of the personal stance investors have on subjects such as climate change and workers' rights, these issues are becoming increasingly important considerations for anyone that is on the hunt for the best investment opportunities of the coming decades and wants to reduce the likelihood of truly ghastly losses.