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Sustainable Funds Are Walking the Walk

Morningstar's Sustainability Rating confirms that funds seeking to invest in sustainable companies have been finding them.

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The new Morningstar Sustainability Rating gives those investors interested in sustainability a way to evaluate the extent to which their fund managers are directing their capital to companies with strong sustainability performance. The rating applies to all funds, provided at least 50% of their assets are in companies covered by Sustainalytics’ ESG ratings.

Among the funds that we would expect to do well in the ratings are those that explicitly hold themselves out as being committed to sustainable investing. In the past, we’ve had to take their word for it. But, thanks to the Sustainability Rating, we now can evaluate whether they are walking the walk or just talking the talk.

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Jon Hale does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.