Sustainable investing evaluates environmental, social, and governance factors alongside traditional financial analysis. It ranges from excluding particular industries to actively selecting companies on environmental or social criteria, and increasingly extends into infrastructure and real assets.
The term covers a wide range of practice, which is why two portfolios described the same way can look very different. Some approaches simply screen out categories. Others weight toward companies scoring well on specific measures. Others target measurable outcomes directly.
The screens that matter are the ones a particular family actually cares about. A generic sustainable product applies someone else's priorities; a screen built around a family's stated values applies theirs, and is far more likely to survive the first year in which it underperforms something else.
This definition is provided for educational purposes. It is general information, not investment, tax, or legal advice, and it does not account for any individual circumstances.