Money, they say, is a mirror of our priorities. In a world grappling with climate change, biodiversity loss, and widening inequality, more and more investors — especially Millennials and Gen Z — are asking a vital question: Can my money do good while also doing well?
This is where green investing steps in. It’s not a trend or a marketing gimmick. It’s a growing movement that seeks to align financial returns with environmental and social impact. And in 2025, it’s never been easier — or more important — to make sure your investments reflect your values.
So how do you build a portfolio that supports a sustainable world and still grows your wealth? Let’s break it down.
The Rise of Green and ESG Investing
The term “green investing” often overlaps with ESG (Environmental, Social, and Governance) investing — a framework used to assess companies not just on their financial metrics, but also on how they treat the planet, people, and ethical governance practices.
By the end of 2024, global assets in ESG funds surpassed $ 11 trillion, according to Morningstar. In Europe alone — the global leader in sustainable finance — ESG funds represented over 20% of total assets under management.
More than just a moral decision, ESG and green investing are becoming strategic financial plays. Companies with strong ESG ratings have been shown to be more resilient during market downturns and often outperform peers over the long term. A 2023 study by MSCI found that ESG leaders had, on average, 15% lower volatility and outperformed their benchmarks by 1.5% annually over a 5-year period.
What Counts as Green? Looking Beyond the Label
Not all funds labeled “green” are truly sustainable. It’s important to look under the hood. Does the fund invest in renewable energy, energy-efficient technologies, or clean transportation? Or does it simply avoid tobacco and weapons?
Some of the more targeted options include:
- Green bonds: Debt instruments used exclusively to fund environmentally friendly projects.
- ETF tematici: Funds that focus on clean water, solar power, electric vehicles, or circular economy models.
- Impact investing platforms: Where you can directly fund projects or startups with measurable environmental or social benefits.
Remember, ESG ratings vary by provider, so dig deeper than the surface score. For example, Tesla may score well environmentally but can receive mixed marks on governance or labor issues.
Balancing Values with Returns
A common concern among new green investors is: “Will I sacrifice returns?” The data says — not necessarily. In fact, 2023 was a strong year for renewable energy funds and ESG ETFs. iShares Global Clean Energy ETF, for instance, gained over 12% in 2023 after a flat 2022, driven by increasing global demand for solar, wind, and electric mobility.
That said, green investing still involves sector-specific risks. Renewable energy stocks can be volatile, and ESG funds may underperform during fossil fuel rallies. But when viewed with a long-term horizon, many sustainable portfolios offer competitive — and often lower-risk — returns.
The key is diversification. You can include ESG-aligned holdings while still having exposure to broader markets, using a “core and satellite” strategy. For example: hold a global ESG ETF for broad diversification, and then add thematic funds (like clean tech or biodiversity) as satellites.
How to Start Green Investing as a Retail Investor
You don’t need to be a professional or have € 50,000 to start aligning your investments with your values. Most online brokers available in Italy and Europe — including Trade Republic, Fineco, or Scalable Capital — offer access to ESG and sustainable funds. Look for ETFs like:
- iShares MSCI Europe SRI UCITS ETF
- Amundi Index MSCI World SRI PAB
- Lyxor New Energy UCITS ETF
You can also set up a PAC (Piano di Accumulo del Capitale) to invest automatically every month — making it both sustainable and stress-free.
For those looking for deeper impact, platforms like Trine or Lendahand allow you to directly finance clean energy projects in emerging markets — and still earn a return.
Think Long-Term, Act Consistently
Like any investment strategy, green investing isn’t about chasing the next “green boom.” It’s about steady, values-aligned choices that make a difference over time.
If you invested € 200/month in a green ETF with a 6% average annual return, after 20 years you’d have over € 91,000 — and that money would have helped support a more sustainable economy.
It’s not just about growing your net worth. It’s about shaping the world you want to retire in.
Your Portfolio, Your Principles
In a time when global challenges demand bold responses, investing with your values is one of the most powerful decisions you can make. Whether you’re just starting with €50 or adjusting a mature portfolio, there are accessible, ethical, and financially sound ways to go green.
