THE ROLE OF ESG (ENVIRONMENTAL, SOCIAL, AND GOVERNANCE) CRITERIA IN INVESTMENT PORTFOLIOS

Abstract

This review research paper examines the pivotal role of ESG (Environmental, Social, and Governance) criteria in modern investment portfolios. The paper provides a comprehensive analysis of how ESG considerations impact investment decision-making, risk management, and financial performance. Key objectives include evaluating the integration of ESG factors in investment strategies, assessing the effectiveness of ESG criteria in mitigating risks, and analyzing the financial implications of ESG-focused investments. The study also investigates the challenges and opportunities associated with incorporating ESG principles into portfolio management, along with exploring emerging trends and best practices in sustainable investing. Through a systematic literature review and data analysis, this paper aims to contribute to the understanding of ESG's influence on investment practices and its implications for sustainable finance.