Can I make an ethical killing on the stock market? We ask an expert

theguardian.com:

The notion of “sustainable investing” had a bumper year in 2021. Aligning investments with climate goals – no fossil fuel companies, for example – promises a good financial return, while benefiting the planet. But is it too good to be true? I asked Tariq Fancy – CEO of non-profit digital learning charity Rumie and ex-head of sustainable investing for investment company BlackRock. Last year Fancy publicly denounced sustainable investing as a “dangerous placebo that harms the public interest”.

I read a claim recently – from research led by Aviva and Make My Money Matter – that turning your pension “green” is 21times more powerful in cutting your carbon footprint than stopping flying, becoming vegetarian and moving to a renewable energy provider combined. That’s ludicrous. Our individual actions reduce real-world emissions. Selling shares in polluting companies does not – it just means someone else buys those shares and owns those emissions.

But sustainable investing must be doing somethinggood? It is, in specific corners of the market. But those aren’t corners the average person can get into, commonly with pensions. The proof is in the pudding. Green investing has increased massively, yet emissions seem to be increasing alongside it. Since the 1980s, people have been beholden to a narrative that the free market will magically self-correct. But climate change is at its core a market failure, and it requires regulation. Investing in ESG falls into that trap.

ESG investing – that’s a type of sustainable investingthat involves buying shares in companies with a good score for “environmental, socialand governance” … ExxonMobil used to have the same ESG score as Tesla! Because the scores are a mashup of different things. ExxonMobil