Definition
Ethical investing channels capital into companies that follow environmental, social, and governance (ESG) principles, aligning profit with purpose.

Introduction
Investors today look beyond dividends — they want their money to heal, not harm. Ethical funds prove that conscience and compounding can coexist.

Explanation
1️⃣ Environmental – Evaluate carbon footprint, waste, and renewable adoption.
2️⃣ Social – Examine labor rights, diversity, community impact.
3️⃣ Governance – Check board independence and anti-corruption measures.
4️⃣ Screening Models – Negative (avoid tobacco/weapons) and positive (support clean tech).
5️⃣ Performance Reality – ESG portfolios increasingly outperform traditional indices due to reduced risk.

Key Takeaways

Profit without ethics is short-lived.

Investors influence corporate conscience.

ESG is the future language of finance.

Real-World Case
BlackRock, the world’s largest asset manager, now votes against boards ignoring climate risks. Its CEO’s annual letters urge firms to deliver “profit and purpose,” redefining investment ethics globally.
Reference: https://www.blackrock.com