ETF stands for ‘exchange-traded fund.’ An ethical ETF is one such fund to invest in ethically. For instance, if the ethical ETF aims to invest in stocks, it will prioritize companies working to become socially responsible and achieve more benefit than harm for people and the planet. The broad focus on total human impact indicates how sustainable and ethical the investment would be.

However, there are differing ethical opinions; what is generally agreed upon is that we treat others the way we wish to be treated. You may have heard of this concept as the “golden rule” in school. By applying this concept to ethical investing, ethical investors can focus on choosing ETFs that treat people with kindness and respect. Recognizing that sustainability is intertwined with ethics, companies that consider reducing the negative impact on others and the environment, and have concern for governance issues that affect them, are generally the most ethically sustainable choices for investment. 

It is essential to recognize that sustainability is a broad term that may not reflect the degree of ethics needed to contribute more benefit than harm to society. Sustainability could be used exclusively to discuss environmental sustainability without paying concern to other factors of sustainability. Sustainable companies may not be sound ethical investments because they only consider a few fundamental sustainability factors. For more information on how to choose sustainable ETFs to invest in, consider the following information. 

Determine What You’re Looking For

In some cases, single theme ETFs may be applicable as sustainable ETFs if you know you’re seeking ethical funds that focus on causes you support. However, remember that this could lead to problematic outcomes for the investment, as the narrow focus may only consider the cause and not the additional effects it creates for society. With sustainable ETFs, you’re looking for the human impact and whether the results are truly contributing more benefit than detriment to society.

What Sustainable ETFs Consider As Single Theme ETFs 

There are undoubtedly single theme ETFs that investors have extensively researched. These investors are comfortable moving forward because they have already concluded that the single theme fund is a wise choice. Working with a firm with experience in researching the different issues involved and measuring human impact can help you make the best ethical investment decisions and prevent you from accidentally overlooking issues from a single theme ETF. 

Look At Monetary Factors 

You also want to look at the traditional concerns that go into sustainable ETFs, as you want to ensure your money allows you to reach financial goals with minimal risk. Review the fund prospectus to determine precisely how your money will be utilized and what is at stake. 

Find The Best Situation For You

Ultimately, choosing sustainable ETFs is about finding the best situation for you and what you hope to accomplish. Following the golden rule and defining sustainability as the total human impact can make it easier to ensure that your investments contribute more benefit than harm to society and the environment.