Millennials are proving that when it comes to making an impact, they’re not happy with a participation trophy. They want to be the most valued players.

Most of us make choices to live life responsibly and ethically, and when we entrust someone with our earnings, we expect they will invest it according to our values. But do we really monitor what our bank or super fund is doing with our money?

... should (investors) simply divest from “bad” companies, or should they be using their stake to change the inner workings of companies?

Three years ago a wave of pressure from media and the public forced KiwiSaver providers to ditch investments in clusters bombs, nuclear weapons and tobacco stocks.

Now providers are facing difficult decisions over investments in Facebook, Google and Twitter while also changing the way they invest to match the New Zealand Government's ban on semi-automatic guns.

The New Zealand Superannuation Fund and KiwiSaver providers are reviewing their exposure to gun-related investments following the Government's ban on semi-automatic weapons.

The NZ Super Fund, Accident Compensation Corporation, Government Superannuation Fund Authority, National Provident Fund and Kiwi Wealth are putting their investment heft behind calls for Facebook, Google and Twitter to take action following the live-streaming and sharing on social media of last week's Christchurch terror attacks.

Ethical investment funds are reviewing their shareholdings in Facebook after the platform was used to livestream the Christchurch terror attacks, as digital giants scramble to defend their practices amid growing global criticism.

ESG integration is a branch of investment analysis that assesses companies on their environmental and social impacts as well as the quality of their governance. It is a tool used by investment managers to gauge the long-term financial health of companies. For example, a company that pollutes the environment could face financial penalties as well as damage to its reputation – both of which could affect the company’s profitability.

In this sense, ESG integration is ethically passive: it is concerned about the financial impact of things like pollution, poor labour practices and a lack of diversity on boards – not whether they are right or wrong.

Jonathan's comment: this is an Australian article but same principles apply in New Zealand / Aotearoa.

If a business model relies on underpaid workers, or even slavery, or weak regulation on social issues, current earnings will unlikely be sustainable. Also, brand damage can lead to loss of sales.

Ethical funds have become more and more popular in recent years as investors look for ways to grow their wealth responsibly. Investing your money in renewable energy, sustainable businesses or community infrastructure may make a positive impact in the world, but what about the impact on your wallet? What sort of returns can you expect from an ethical investment and how do they compare to other types of investments?

Responsible investors can be forgiven for experiencing more than a little schadenfreude over Johnson & Johnson's tumble on US markets before Christmas.

The US healthcare giant saw more than $54 billion wiped from its sharemarket value in a single day following reports that it knew batches of its iconic baby powder were contaminated with asbestos, a known carcinogen. And since then the rout has continued.

But for responsible investors, those that consider a company's environmental, social and governance (ESG) performance alongside traditional financial measures such as revenue growth, profit, loss and balance sheet strength, the reports contained nothing new.