How does sustainable investing differ from traditional investing?

Sustainable investing differs from traditional investing in that it incorporates environmental, social, and governance (ESG) factors into the investment decisionmaking process. Traditional investing typically focuses solely on financial metrics such as profitability, growth potential, and risk management. Sustainable investing considers not only the financial performance of a company, but also its impact on society and the environment.

Sustainable investing aims to generate positive social and environmental impacts while delivering competitive financial returns. It involves evaluating companies on ESG factors such as their carbon footprint, diversity and inclusion policies, labor practices, and ethical standards. By investing in companies that have strong ESG practices, sustainable investors can help drive positive change while still achieving their financial goals.