Vanguard Global ESG Select Stock Profits from ESG Leaders
Vanguard Global ESG Select Stock (VEIGX) favors firms with high standards for their businesses.
It was a bit late to the party, but Vanguard Global ESG Select Stock (VEIGX) is having a blast so far. The fund launched in 2019—well into the ESG investing trend, which places as much value on environmental, social and corporate governance criteria as on financial measures when selecting stocks. Over the past three years, managers Mark Mandel and Yolanda Courtines, of subadvisory firm Wellington Management, have delivered a 10.1% annualized return. That beat the fund’s bogey, the FTSE All-World index, as well as the typical global large-company stock fund with an ESG focus.
Mandel and Courtines pick profitable, well-run firms around the globe that are leaders in integrating ESG practices into their businesses. They focus on companies that have a market value of more than $20 billion and score well on stewardship, says Mandel. That means the firm’s board members are steering the company toward a future that rewards all stakeholders, including employees, shareholders and the planet.
Take farm equipment giant Deere (DE), one of the fund’s 37 holdings. Its See & Spray technology uses computer vision and machine learning to spray pesticides only on weeds in corn, soybean and cotton fields. This decreases the environmental impact of pesticides and increases a farmer’s crop yield at the same time. The company has a loyal band of employees, too, a vibe Mandel and Courtines picked up on during a recent tour of a Deere plant. And they say new board members with more tech expertise may help push the company forward.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Mandel and Courtines like to get involved with the companies they own shares in, though some are far flung. Half of the fund’s assets are invested in foreign stocks, including Hong Kong–based insurance behemoth AIA Group and Swiss health care company Novartis. Some companies resist engaging with the managers at first but come around eventually. For instance, Colgate-Palmolive (CL) executives, says Courtines, are now open to suggestions about which ESG metrics the firm should focus on. “We set a high bar and give companies the opportunity to be proactive” on setting ESG targets, she says. Otherwise, “we start to look elsewhere.”
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.
Rivan joined Kiplinger on Leap Day 2016 as a reporter for Kiplinger's Personal Finance magazine. A Michigan native, she graduated from the University of Michigan in 2014 and from there freelanced as a local copy editor and proofreader, and served as a research assistant to a local Detroit journalist. Her work has been featured in the Ann Arbor Observer and Sage Business Researcher. She is currently assistant editor, personal finance at The Washington Post.
-
Holiday Office Party Taxes: Know Before You Go
Tax Tips The IRS could tax your gifts from Christmas raffles, Secret Santa, and White Elephant. Here’s how.
By Kate Schubel Published
-
2025 Tax Reform: Will the SALT Deduction Cap Be Repealed?
Tax Deductions Some lawmakers say it’s time to end the $10,000 cap on state and local tax deductions.
By Kelley R. Taylor Published
-
Smart Ways to Invest Your Money This Year
Following a red-hot run for the equities market, folks are looking for smart ways to invest this year. Stocks, bonds and CDs all have something to offer in 2024.
By Jeff Reeves Published
-
Vanguard's New International Fund Targets Dividend Growth
Investors may be skittish about buying international stocks, but this new Vanguard fund that targets stable dividend growers could ease their minds.
By Nellie S. Huang Published
-
Where To Invest Your 401(K)
Knowing where to invest your 401(k) money can be difficult. Here, we rank 10 of the largest retirement funds.
By Nellie S. Huang Published
-
7 Best Stocks to Gift Your Grandchildren
The best stocks to give your grandchildren have certain qualities in common.
By Dan Burrows Last updated
-
How to Find the Best 401(k) Investments
Many folks are likely wondering how to find the best 401(k) investments after signing up for their company's retirement plan. Here's where to get started.
By Deborah Yao Published
-
How to Master Index Investing
Index investing allows market participants to use baskets of stocks and bonds to build the best portfolio to meet their goals. Here's how it works.
By Nellie S. Huang Published
-
How to Find the Best Vanguard ETFs
Investors looking for the best Vanguard ETFs would be wise to follow the philosophy of John Bogle, the asset manager's founder.
By Jeff Reeves Last updated
-
Donor-Advised Funds: A Tax-Savvy Way to Rebalance Your Portfolio
Long-term investors who embrace charitable giving can easily save on capital gains taxes by donating shares when it’s time to get their portfolio back in balance.
By Adam Nash Published