Greenwashing is rife. The exposure and impact of the two fund groups is similar. On an aggregated SDG basis, sustainable funds perform just two percentage points better than the benchmark, despite a 43% higher average fee.
Investing causes environmental degradation. The SDGs address planet, people, and prosperity. Both fund groups have a positive impact on ‘prosperity’, slight positive impact on ‘people’ and negative impact on ‘planet’ goals.
Impact is unpredictable. Positive and negative relationships arise between ostensibly uncorrelated investments and SDGs. The chaos creates challenges—and opportunities. Exposure to the full value chain of a theme yields alpha and diversification.
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