Content and data provided by various third parties and Fidelity − Terms of Use | Help/Glossary
Research > ETFs > ETF / ETP Commentary > 

ESG Investing Not as Controversial as Meets the Eye

BY | ETF Database
02/14/2025 | 350 VIEWS
It’s often said that voters have short attention spans, and the same is arguably true of politicians. The confluence of both factors could prove to be a source of encouragement for proponents of ESG investing.Those positive vibes extend to ETFs like the Invesco ESG Nasdaq 100 ETF (QQMG B+) and the Invesco ESG Nasdaq Next Gen 100 ETF (QQJG C+). Following a multiyear run in which ESG was a primary focus in Corporate America, stoking sizable inflows into related investment vehicles, it then became a hot-button political issue. The ensuing controversy brought an unprecedented level of divisiveness to the ESG investing discussion. That  prompted some companies to alter their messaging. It also compelled regulators to apply more scrutiny to ESG ratings and scoring. Some of the negativity appears to be waning.ESG Controversies ExaggeratedThere are credible reasons to believe ETFs such as QQJG and QQMG have staying power. Recent research from the Stanford Rock Center for Corporate Governance indicates  ESG framing goes a long way toward improving investors’ attitudes. “… the study used a series of decision tasks where respondents chose between two hypothetical pension fund options. Each option included an expected annual pension amount and several investment restrictions, such as avoiding companies tied to fossil fuels or gambling,” reported Steve Kerch for Equities.com. Not surprisingly, the aforementioned political divide as it relates to ESG investing is along voting lines. Democrat voters and states are ESG supporters, while their Republican counterparts are ESG-skeptical. What’s noteworthy for ESG proponents and issuers of funds like QQJG and QQMG is folks with conservative political leanings aren’t necessarily 100% ESG-averse. The Stanford study indicates those folks can be ESG-flexible provided they like the related messaging. “The phrasing was key. Abstract concepts like ‘labor rights,’ which some may associate with a political agenda, led conservative respondents to prioritize profitability over social goals. Yet, when social causes were presented in more detail—such as ‘guaranteeing living wages’—support grew across the political spectrum,” added Kerch. Studies suggest that even ESG detractors are willing to accept lower returns. But that’s provided that the companies they invest in aren’t engaging in harmful practices. Fortunately, subpar returns aren’t something committed QQMG and QQJG investors need to worry about. That’s because the ETFs have performed admirably relative to their non-ESG equivalents over extended holding periods. For more news, information, and analysis, visit the ETF Education Channel.

More Commentary

Top Active ETF TCAF Adds More Than Half a Billion in 1 Month
BY | ETF Database
04/02/2025 | 43 VIEWS
Sell on the Pop Prospects: April 2 Edition
BY | ETF Database
04/02/2025 | 5 VIEWS
Gold's Rally Continues to Tee Up Opportunities for Miners
BY | ETF Database
04/02/2025 | 44 VIEWS
View more Commentary

Search Commentary

Enter Keyword(s)
Filter Results

Performance data shown is past performance and is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. Yield and return will vary, therefore you have a gain or loss when you sell your shares. For standard quarterly performance, go to the fund's Snapshot page by clicking on the ETF/ETP's symbol.

ETFs may trade at a premium or discount to their NAV and are subject to the market fluctuations of their underlying investments.

For iShares ETFs, Fidelity receives compensation from the ETF sponsor and/or its affiliates in connection with an exclusive long-term marketing program that includes promotion of iShares ETFs and inclusion of iShares funds in certain FBS platforms and investment programs. Please note, this security will not be marginable for 30 days from the settlement date, at which time it will automatically become eligible for margin collateral. Additional information about the sources, amounts, and terms of compensation can be found in the ETF's prospectus and related documents. Fidelity may add or waive commissions on ETFs without prior notice. BlackRock and iShares are registered trademarks of BlackRock, Inc. and its affiliates.

FBS receives compensation from the fund's advisor or its affiliates in connection with a marketing program that includes the promotion of this security and other ETFs to customers ("Marketing Program"). The Marketing Program creates incentives for FBS to encourage the purchase of certain ETFs. Additional information about the sources, amounts, and terms of compensation is in the ETF's prospectus and related documents. Please note that this security will not be marginable for 30 days from the settlement date, at which time it will automatically become eligible for margin collateral.

News, commentary (including "Related Symbols") and events are from third-party sources unaffiliated with Fidelity. Fidelity does not endorse or adopt their content. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use.

Any data, charts and other information provided on this page are intended to help self-directed investors evaluate exchange traded products (ETPs), including, but limited to exchange traded funds (ETFs) and exchange traded notes (ETNs). Criteria and inputs entered, including the choice to make ETP comparisons, are at the sole discretion of the user and are solely for the convenience of the user. Analyst opinions, ratings and reports are provided by third-parties unaffiliated with Fidelity. All information supplied or obtained from this page is for informational purposes only and should not be considered investment advice or guidance, an offer of or a solicitation of an offer to buy or sell a particular security, or a recommendation or endorsement by Fidelity of any security or investment strategy. Fidelity does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating ETPs. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use. Determine which securities are right for you based on your investment objectives, risk tolerance, financial situation and other individual factors and re-evaluate them on a periodic basis.

Before investing in any exchange traded product, you should consider its investment objective, risks, charges and expenses. Contact Fidelity for a prospectus, offering circular or, if available, a summary prospectus containing this information. Read it carefully.