I think Cullen Roche has a good take on this. For example: > 2) The secondary market is a bad place to enact change. The intelligent defense of ESG is “by redu

I think Cullen Roche has a good take on this. For example: > 2) The secondary market is a bad place to enact change. The intelligent defense of ESG is “by reducing the demand for a stock we can increase its cost of capital and impact its operating performance.” This is true to some degree, but I think this is dramatically overstated. For instance, the firms in the S&P 500 are all large established firms that have more than enough capital to finance their operations. They aren’t using the secondary equity markets to fund their operations. In fact, most firms have so much capital that they’ve been net buyers of stock in the last 50 years. So, this puts the cart before the horse. The better way to think of public companies is to think of them like horse betting. We can bet on the horses, but secondary market purchases are just private exchanges, not cash issuance to firms. As a result, betting on the horses doesn’t change the outcome of the race. Similarly, our secondary market purchases and sales have a far smaller impact on the firm’s operations than we might think.¹ * https://www.pragcap.com/my-view-on-esg-investing/ https://www.pragcap.com/my-view-on-esg-investing/ > Look, I completely understand. I want to invest my money, beat the market AND do what I feel like is right. But be really careful buying into the narrative about how ESG funds outperform. In most cases they aren’t being benchmarked properly and you’re just paying higher fees to chase performance that isn’t even as good as it’s advertised as. * https://www.pragcap.com/sorry-but-your-esg-funds-probably-suck/ https://www.pragcap.com/sorry-but-your-esg-funds-probably-su... A good interview I found on the topic: > Alex’s book, “Grow the Pie: How Great Companies Deliver Both Purpose and Profit”, was featured in the Financial Times list of Business Books of the Year for 2020, and he is a co-author of “Principles of Corporate Finance” (with Brealey, Myers, and Allen) for the 14th edition to be published in April 2022. He was named Professor of the Year by Poets & Quants in 2021. * https://rationalreminder.ca/podcast/192 https://rationalreminder.ca/podcast/192 It may be better to do non-ESG investing and use the "excess" returns to fund advocacy groups that will push for political change in the area that you wish. All the oil and coal barons are funding climate change denial messaging for example. Further, if you're a stockholder of a "bad" company, you can vote for motions that the company to change its policies to become a "good" company. If you only own "good" companies, they're already doing the "right" thing. You want to 'reform' the ones doing the "wrong" thing.