Sustainable investing

Sustainable investing means taking environmental, social and governance criteria into account alongside returns when you invest.

The 3 approaches at a glance:

1. ESG (Environment, Social, Governance):

• Moderate filter: excludes the worst ~25%
• Approx. 1,200 instead of 1,500 shares (MSCI World ESG)
• TER: 0.18–0.20%

2. SRI (Socially Responsible Investing):

• Strict filter: only the best ~25% remain
• Approx. 400 shares (MSCI World SRI)
• No tobacco, weapons, alcohol, gambling, nuclear power, fossil fuels

3. PAB (Paris-Aligned Benchmark):

• Aligned with the 1.5°C climate target
• 50% lower CO2 intensity than the parent index
• Annual decarbonisation of 7%

Performance comparison (5 years):

• MSCI World: ~10% p.a.
• MSCI World ESG: ~9.8% p.a.
• MSCI World SRI: ~9.5% p.a.
• Difference: under 0.5% – statistically barely relevant

Greenwashing risk:

• Not everything called "sustainable" actually is
• EU Sustainable Finance Disclosure Regulation (SFDR): since 2021, funds have had to disclose their level of sustainability
• Article 8 ("light green"): takes sustainability characteristics into account
• Article 9 ("dark green"): has a concrete sustainability objective

Recommendation:

For broad diversification: the ESG variant (1,200 shares). For maximum sustainability: SRI or PAB. The performance trade-off is minimal.