The escalating coronavirus pandemic has ushered in a new era of stock market volatility, as investors come to terms with consecutive history-making daily swings. But it has also shone a spotlight on a promising investment opportunity — one that’s been winning the hearts of millennials.
Sustainable investments — those focused on companies with strong environmental, social and corporate governance (ESG) principles — outperformed their conventional counterparts in the first quarter of 2020, even as the outbreak sent markets crashing.
In the first three months of the year, 70% of sustainable equity funds recorded returns in the top halves of their broad-based peer group, according to investment research firm Morningstar. Of those, 44% scored within the top quartile. When the full extent of the pandemic became clear in early March, ESG-aware companies outperformed other stocks by up to 5.7%, HSBC found.
To be sure, sustainable funds still suffered heavy losses amid last month’s…