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Investment ISAs / Ethical ISAs /

ESG ISA

Invest in line with your principles

Investment ISAs put your capital at risk & you may get back less than you originally invested

Ethical ISAs

Socially Responsible Portfolio

from Nutmeg

Allows ISA Transfers
  • Fund Choice: Nutmeg allow you to align your investments with your values. With continuous oversight from the Nutmeg in-house investment team, their SRI portfolios place an emphasis on environmental, social and governance factors. Capital at risk.
  • Invest From: Min. £500 single

Why we like it: If investing responsibly is important to you then Nutmeg have put together a portfolio tilted towards companies and bond issuers that have high environmental, social and governance (ESG) standards. Nutmeg invest in exchange traded funds (or ETFs) that avoid companies engaged in controversial activities while focusing on those that lead their peers on ESG. No tie-ins, no set-up fees, no exit charges. Easy, online set up in minutes. Start with as little as £500.

Future World ESG UK Tracker

from Legal & General

Allows ISA Transfers
Regular Savings
  • Fund Choice: The Fund aims to track the performance of the Solactive L&G Enhanced ESG UK Index. Capital at risk.
  • Invest From: £25

Tracks shares in companies that demonstrate good environmental, social and governance efforts and are incorporated or headquartered or which have their principal business activities in the UK.

Sustainable Leaders

from Royal London

Allows ISA Transfers
Regular Savings
  • Fund Choice: Invests in companies that are likely to benefit from measures taken to improve the environment, human welfare and quality of life. Capital at risk.
  • Invest From: £25 pm

Why we like it: This fund works on a “best ideas” basis with 40 to 50 company holdings. The fund applies both negative and positive screening. There is also a focus on long-term themes and trends such as infrastructure and changing demographics. The fund has reasonable ongoing charges of 0.76% pa for an actively managed fund.

ii ACE 40 investments

from Interactive Investor

Allows ISA Transfers
Regular Savings
  • Fund Choice: 140+ Ethical Investments. Capital at risk.
  • Invest From: £25 a month or any lump sum
  • Investment Options: A selection of 140+ funds, investment trusts and ETFs that they believe offer high-quality ethical investment choices, across a range of markets.

Why we like it: The UK's first rated list of ethical investments to help you align investments with your personal values. Building your investment portfolio can be tough – and it is even more difficult when you want to choose ethical investments. That can mean a lot of research. The ii ACE 40 makes the job easier for you. Interactive Investor select 40 funds, investment trusts and ETFs from over 140 that they believe offer high-quality choices, across a broad variety of markets.

Positive Change

from Baillie Gifford

Allows ISA Transfers
Regular Savings
  • Fund Choice: Actively managed fund that invests in global company shares where products or services make a positive impact on society or the environment. Capital at risk.
  • Invest From: £25 pm

Invests in up to 50 global companies. The funds largest exposure is to the health care sector (35%), while its top 10 holdings include Tesla, Alphabet, and Taiwan Semiconductor Manufacturing Company. Investments will be made in companies addressing critical challenges in areas such as, but not limited to; education, social inclusion, healthcare and the environment.

Better World

from Montanaro

Allows ISA Transfers
Regular Savings
  • Fund Choice: Actively managed Fund that seeks to invest in high quality companies whose products, services or behaviour are deemed to make a positive impact on society and which emphasize sound environmental, social and governance (ESG) practices. Capital at risk.
  • Invest From: £25 pm

Why we like it: The fund manager seeks to identify profitable and well managed businesses that make a positive impact on society operating in markets that offer attractive structural growth opportunities.

Environmental Markets

from Impax

Allows ISA Transfers
Regular Savings
  • Fund Choice: Investment trust that invests predominantly in companies that provide, utilize, implement or advise upon technology-based systems, products or services in environmental markets, particularly those of alternative energy and energy efficiency, water treatment and pollution control, waste technology & resource management. Capital at risk.
  • Invest From: £25 pm

Why we like it: Launched in 2002 Impax Environmental Markets is one of the UK’s largest environmental focused investment trusts which aims to enable investors to benefit from growth of more efficient delivery of services such as energy, water and waste.

Responsible Global Equity

from BMO

Allows ISA Transfers
Regular Savings
  • Fund Choice: Invests in companies whose operations are considered to be making a positive contribution to society and seeks to avoid companies which, on balance, are felt to be harming the world, its people or its wildlife. Capital at risk.
  • Invest From: £25 pm

Why we like it: This fund works on a “best ideas” basis with 40 to 50 company holdings. The fund applies both negative and positive screening. There is also a focus on long-term themes and trends such as infrastructure and changing demographics. The fund has reasonable ongoing charges of 0.76% pa for an actively managed fund.

UK Ethical Income

from Unicorn

Allows ISA Transfers
Regular Savings
  • Fund Choice: Actively managed fund that aims to provide an income by investing in UK companies which meets ethical guidelines. Capital at risk.
  • Invest From: £25 pm

The fund will invest in ethical companies based on thorough company analysis, with ethical and socially responsible criteria reviewed at the point of investment and quarterly thereafter. The Fund invests at least 80% in UK quoted companies with a bias towards small and medium sized companies (those with a market value of less than £4 billion).

Global Clean Energy ETF Tracker

from iShares

Allows ISA Transfers
Regular Savings
  • Fund Choice: Tracks companies in the clean energy sector. Capital at risk.
  • Invest From: £25 a month or any lump sum

Good to know: A member of the Interactive Investor ACE 40 ,this fund is passively managed by BlackRock and reflects the return of the S&P Global Clean Energy Index (the benchmark). The Index is designed to provide exposure to the leading publicily listed companies in the global clean energy business from both developed and emerging markets.   The fund has reasonable ongoing charge of 0.65% pa.

What is a ESG ISA?

A ESG ISA is an ISA where your money is used to invest in assets that come under the umbrella of investments that seek positive returns and a long term impact on the Environment, Social issues and business Governance.

Basically ESG funds seek to have a positive impact on the world.

Investing within an ISA wrapper allows any investment returns to be generated tax efficiently.

ESG funds typically invest in the companies involved in activities that deal with mitigating climate change and new technologies that seek to provide better prospects for the environment. 

They are suitable for people who are willing to leave funds in their ISA for long periods such as five years. They are also good for people who are willing to withstand a bit more fluctuation in the value of their fund.

What investments are likely to be considered for ESG investment?

A fund manager taking into account ESG principles means that environmental, socials and governance criteria will be at the top of the list when connsidering what to invest in.

For example when assessing a company to invest in a fund manager will look at:

  • Environmental track record
  • Energy consumption
  • Policy on climate change
  • Waste management
  • Community engagement
  • Human rights record
  • Employee relations policy
  • How the business is run
  • Diversity of the management team
  • Quality of the management team & potential conflicts of interest

ESG investing puts on a more even footing investing responsibly with the need to deliver investment returns for investors.

Why is ESG investing important?

According to the United Nations the world's population is growing at a rate of 83 million people per year. By the year 2050 it is calculated that there will be 9.9 billion people on our planet with over 25% aged 65+. 

The need to ensure that the planet can cope with this increasing dynamic on our finite resources is more important than ever.

ESG investing is becoming increasingly popular with a greater awareness by investors for the need to invest sustainably. There is now more than $21.4 trillion invested sustainably.

In the UK sustainable investment for 85% of 18 to 36 year olds sustainable investment is seen as an important factor when investing.

What is the difference between Ethical and ESG Investing?

Ethical investing tends to avoid companies that have a negative impact on the environment or society. In an ethical fund the manager will typically screen out companies involved in certain activities or industries e.g. oil and gas, tobacco.

With ESG investing fund managers typically focus on companies that are having a positive impact on the world, so its less black and white when it comes to the types of companies that might be included in a fund. 

This approach means that a company in the oil and gas sector for example which has a progressive approach to clean energy might be included.

FREE Guide

Could you profit from your principles?

Responsible investment means different things to different people. In this guide, we break down the jargon and look at some of the main ways you can align your principles with your investments. Find out more about:

  • Stewardship, ESG, exclusions-based, and impact funds
  • How responsible investment funds might perform
  • How to pick shares that fit your moral compass

Request Hargreaves Lansdown FREE guide »

Important Risk Information:

The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website aims to provide information to help you make your own informed decisions. It does not provide personal advice based on your circumstances. If you are unsure of how suitable an investment is for you, please seek personal advice.

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Latest News

5 Considerations for Your Next Investment ISA

15th March 2021

You've decided to invest your savings into a Stocks and Shares ISA. You'll be using your tax-free ISA allowance for this year before the deadline, while also investing your money for your future. But what do you need to consider before opening an account? We've put together a list of our top five considerations for you to think about before you click "apply". 

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