5 High-Performing Ethical ETFs

Investing your money ethically doesn’t mean that you have to accept low returns. Here are five high-performing ethical exchange traded funds (ETF), based on their 5-year performance as of July 30, 2022.

This list is based on the top-performing ETFs on the ASX, and an ethical product is determined to be one that is specifically advertised as ‘ethical’ or ‘sustainable’.

1) BetaShares Global Sustainability Leaders ETF (ETHI)

5-year return: 72.73%%

The BetaShares Global Sustainability Leaders Fund is an exchange traded fund that actively seeks to invest in 100 large global companies, excluding Australian companies, that have been identified as leaders in climate sustainability. This includes companies with high carbon efficiency or involved in reducing emissions and excludes companies that are exposed to the fossil fuel industry.

→ Related article: Which ETFs Have the Highest Return on Investment?

2) Vanguard Ethically Conscious International Shares (VESG)

5-year return: 33.15%

This Vanguard fund offers exposure to many of the world’s largest companies listed in major developed countries, while excluding companies with significant business activities involving fossil fuels, nuclear power, alcohol, tobacco, gambling, weapons and adult entertainment.

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3) VanEck Vectors MSCI International Sustainable Equity (ESGI)

5-year return: 32.5%

ESGI invests in a diversified portfolio of sustainable international companies listed on exchanges in developed markets around the world (ex Australia). The funds screens out companies that own any fossil fuel reserves or derive revenue from mining thermal coal or from oil and gas related activities; and companies whose business activities are not deemed socially responsible investments (SRI).

→ Related article: Which ETFs Have the Highest Return on Investment?

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4) BetaShares Australian Sustainability Leaders ETF (ASX: FAIR)

5-year return: 16.73%

This BetaShares ETF tracks a diverse portfolio of Australian companies with no direct or significant exposure to fossil fuels or that engaged in activities deemed inconsistent with responsible investment considerations. This fund also prioritises companies considered ‘Sustainability Leaders’ meaning that they are involved in sustainable business activities. Some of the companies that FAIR does not invest in are any of the “Big 4 Banks”, or large Australian mining companies.

5) BetaShares Global Sustainability Leaders ETF – Currency Hedged (HETH)

5-year return: 13.60%

HETH includes a portfolio of large global stocks identified as ‘climate leaders’ while excluding companies with direct or significant indirect exposure to fossil fuels or engaged in activities deemed inconsistent with responsible investment considerations.

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