The line about judging investments purely from a holding standpoint is kinda fraught and I'm surprised to see it so confidently printed. What the authors are ap

The line about judging investments purely from a holding standpoint is kinda fraught and I'm surprised to see it so confidently printed. What the authors are appealing to is the E in ESG investing. Freakonomics recently did a great interview with Kelly Shue about the effects of ESG investing and viable counter examples like Engine Number 1: https://freakonomics.com/podcast/are-e-s-g-investors-actually-helping-the-environment/ https://freakonomics.com/podcast/are-e-s-g-investors-actuall... The gist of the study that Kelly performed showed that many, if not most, companies with good E values are companies who never had environmental impact in the first place. They exist in well trodden spaces whose biggest impacts were office space and data centers. The net action of divesture causes less money available to be able to innovate, doesn't provide the kind of momentum an activist investor like Engine Number 1 can, and works by proliferating the idea that change can be claimed by effectively ignoring that problematic companies exist and will continue to exist. The last bit, for those unaware, comes from the fact that even if all cars today were made fully electric there is still a huge line of demand for essential products, like fertilizer, that include oil derivatives. My point more broadly being in order to judge consumers you can't just look at holdings, you need to see what they're materially supporting. If they materially support the indefinite expansion of oil extraction and not trying to innovate away from oil then they're doing harm. Simply investing in a company is not indication of how an investor would vote when presented an opportunity to change the company direction by a group of activists. Engine Number 1 did exactly this with Exxon and shareholders voted as I described.