Investment products

ESG investing


Discover funds that reflect what matters most to you. Explore how ESG funds can play a valuable role in your portfolio.
 

What's ESG investing?

ESG investing, which typically assesses the factors listed below, offers a way for you to invest in funds that consider environmental, social, and governance issues. You may hear the term used interchangeably with "socially responsible investing (SRI)" and "sustainable investing."

Environmental

Conservation & protection of the natural environment

• Air emissions and air quality.
• Energy use and conservation.
• Natural resources and land use.
• Waste management and water quality.
• Hazardous materials use.

Social

Relationships with employees, suppliers, clients & communities

• Labor standards and employee relations.
• Production quality and safety.
• Local community impact.
• Equal employment opportunities.
• Health care, education, and housing services.

Governance

Standards for company leadership, risk controls & shareholder rights

• Ethical business practices.
• Board independence and diversity.
• Voting rights.
• Executive pay vs. employee pay.
• Account and tax transparency.

Discover Vanguard's ESG lineup

Our ESG funds, which have differing investment styles and objectives, invest in stocks and bonds. They're a great way to complement your portfolio with funds that reflect your values. Most of our funds are indexed and follow an exclusionary strategy that omits companies that don't meet certain ESG criteria. We currently have one active fund with an inclusionary strategy that includes companies making strides toward ESG practices, and one fund that’s designed to support investors seeking actively managed global equity returns along with measurable impact on environmental and social challenges.

Fund
VEIGX
Global ESG Select Stock Fund

Investment type
Mutual fund

ESG strategy
Integrated
What's included

Management style
Actively managed (approx. 40-50 stocks)

Geographic coverage
U.S. and international


Fund
ESGV
ESG U.S. Stock ETF

Investment type
ETF

ESG strategy
Exclusionary
What's excluded

Management style
Indexed (approx. 1,500 stocks)

Geographic coverage
U.S. only


Fund
VSGX
ESG International Stock ETF

Investment type
ETF

ESG strategy
Exclusionary
What's excluded

Management style
Indexed (approx. 3,000-4,000 stocks)

Geographic coverage
International only


Fund
VFTAX
FTSE Social Index Fund

Investment type
Mutual fund

ESG strategy
Exclusionary
What's excluded

Management style
Indexed (approx. 500 stocks)

Geographic coverage
U.S. only


Fund
VCEB
ESG U.S. Corporate Bond ETF

Investment type
ETF

ESG strategy
Exclusionary
What's excluded

Management style
Indexed (approx. 200-300 bonds)

Geographic coverage
U.S. only


Fund
VBPIX
Baillie Gifford Global Positive Impact Stock Fund

Investment type
Mutual fund

ESG Strategy
Impact
What's included

Management style
Actively managed (approx. 25-50 stocks)

Geographic coverage
U.S. and international


Discover Vanguard's ESG lineup

Our ESG funds, which have differing investment styles and objectives, invest in stocks and bonds. They're a great way to complement your portfolio with funds that reflect your values. Most of our funds are indexed and follow an exclusionary strategy that omits companies that don't meet certain ESG criteria. We currently have one active fund with an inclusionary strategy that includes companies making strides toward ESG practices, and one fund that’s designed to support investors seeking actively managed global equity returns along with measurable impact on environmental and social challenges.

 

Fund Investment type ESG strategy Management style Geographic coverage
VEIGX
Global ESG Select Stock Fund
Mutual fund Inclusionary
What's included
Actively managed
(approx. 40-50 stocks)
U.S. and international
ESGV
ESG U.S. Stock ETF
ETF Exclusionary
What's excluded
Indexed
(approx. 1,500 stocks)
U.S. only
VSGX
ESG International Stock ETF
ETF Exclusionary
What's excluded
Indexed
(approx. 3,000-4,000 stocks)
International only
VFTAX
FTSE Social Index Fund
Mutual fund Exclusionary
What's excluded
Indexed
(approx. 500 stocks)
U.S. only
VCEB
ESG U.S. Corporate Bond ETF
ETF
Exclusionary
What's excluded
Indexed
(approx. 200-300 bonds)
U.S. only
VBPIX
Baillie Gifford Global Positive Impact Stock Fund

Mutual fund
Impact
What's included
Actively managed
(approx. 25-50 stocks)
U.S. and international

Gaining momentum

ESG investing has gone mainstream thanks to better information and an increased interest from investors seeking to make an impact through their investment decisions. It's driven by individuals who embrace the idea that their investment objectives and personal values aren't mutually exclusive.

For investors in the United States, there are more than 600 ESG funds and ETFs (exchange-traded funds) available.*

Gaining momentum

ESG investing has gone mainstream thanks to better information and an increased interest from investors seeking to make an impact through their investment decisions. It's driven by individuals who embrace the idea that their investment objectives and personal values aren't mutually exclusive.

For investors in the United States, there are more than 600 ESG funds and ETFs (exchange-traded funds) available, representing $161 billion in assets under management.*

Source: Morningstar Direct. Data as of July 31, 2020

Reliable reporting & research

Investment managers and investors now have more information on how ESG factors affect companies, allowing them to make better decisions.

More than 11,000 companies worldwide report on how they incorporate ESG principles into their business strategies, resources, and operations. In addition, 125 organizations produce research on the ESG investment landscape.

Delivering long-term value

Some investors believe ESG investing means sacrificing returns. Keep in mind that as with any investment strategy that pursues objectives beyond tracking a broad market benchmark, investors should expect periods when screened ESG investments underperform or outperform the market. Over the long term, we believe our ESG products are enduring investment options for anyone interested in aligning their values with their fund selections. Since each fund is different, always pay close attention to its strategy and approach when making investment decisions.

Our dedication to responsible investing

Vanguard has been managing ESG investment products for over 20 years, starting with our FTSE Social Index Fund, which launched in 2000. It's now the largest ESG-screened index fund in the United States.*

For more than 45 years, we've taken a stand for all investors while advocating for improved corporate governance in the market. As a signatory to the United Nations-supported Principles for Responsible Investment, we encourage companies to conduct business in a socially conscious way.

Investment stewardship

We work to ensure public companies act and operate in a way that creates long-term value for fund shareholders. Our Investment Stewardship team is a leader in global governance among asset managers.

Corporate stewardship

We're committed to investing in our workplace, supporting our local communities, and developing investment products, services, and infrastructure to serve our clients' interests.

Investment management

We embrace the same investing principles across all our products: clear goals, broad diversification, low costs, and a long-term view.

*Source: Morningstar Direct. Data as of July 31, 2020

All investing is subject to risk, including the possible loss of the money you invest.

ESG funds are subject to ESG investment risk, which is the chance that the stocks or bonds screened by the index provider for ESG criteria generally will underperform the market as a whole or, in the aggregate, will trail returns of other funds screened for ESG criteria. The index provider’s assessment of a company, based on the company’s level of involvement in a particular industry or the index provider’s own ESG criteria, may differ from that of other funds or of the advisor’s or an investor’s assessment of such company. As a result, the companies deemed eligible by the index provider may not reflect the beliefs and values of any particular investor and may not exhibit positive or favorable ESG characteristics. The evaluation of companies for ESG screening or integration is dependent on the timely and accurate reporting of ESG data by the companies. Successful application of the screens will depend on the index provider’s proper identification and analysis of ESG data.

For more information about Vanguard funds or ETFs, visit vanguard.com to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information about a fund are contained in the prospectus; read and consider it carefully before investing.