New state legislation will prohibit “public entities” from any investment activity that examines environmental, social and governance factors, starting July 1. While ESG has been a controversial topic for some time, it is now crucial that public opinion is heard and that folks understand how ESG fits into our economy.

ESG stands for Environmental, Social and Governance. It is the newest acronym in a growing and evolving market of ethical investing. ESG funds factor a company’s carbon footprint, supply chain, fair wages, diversity and internal auditing into their investment strategy.

While there are similarities between ESG and Socially Responsible Investing, the differences are where most critics take issue. It is a personal decision and preference to invest in a private company that is certified Fair Trade, or makes solar panels, for example, and divest from fossil fuels or a company under investigation.

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