Most nonprofits have probably considered environmental, social, and governance (ESG) investing, or soon will. Interest has escalated, and as a result, advice abounds. Reading it, only one thing seems clear: ESG investing is complex. It seems every answer leads to two questions, and it’s no surprise that many turn away after an initial look.
The good news is that while it is true that ESG investing is complex, it doesn’t have to be complicated, and contrary to old beliefs, it doesn’t necessarily damage returns. With a solid understanding of what an organization wishes to accomplish, investment committees can implement ESG in a way that doesn’t necessarily sacrifice returns—but does bring investments into alignment with a foundation’s greater goals.