World Environment Day 2023: A look at top ESG funds in India

Environmental, social, and governance (ESG)-based investing is set to receive a boost in India after the Securities and Exchange Board of India (SEBI) recently allowed mutual funds to launch multiple schemes based on ESG-linked factors. These funds need to ensure that at least 65 per cent of the funds are invested in listed shares of companies for which assurance on the Business Responsibility and Sustainability Report (BRSR) is undertaken, SEBI announced in March.

In India, ESG funds are classified under thematic equity schemes. The changes in rules regarding ESG-based investments are especially pertinent in light of World Environment Day, which is celebrated across the world on June 5 every year.

ESG-based investments can be a great way to do your bit for the environment. These funds invest in companies that meet environmental, social, or corporate governance standards and adopt ethical practices to gain profit.

This World Environment Day, you can go green through ESG-based MFs.

If you are looking to invest in ESG-based mutual funds, here are the top options in India.

SBI Magnum Equity ESG Fund (Growth)

The fund has assets under management (AUM) worth Rs 4,411.657 crore. The mutual fund has generated 12.3 per cent returns in the past one year. The minimum investment required under a systematic investment plan (SIP) is Rs. 1,000. There is no lock-in period.

Axis ESG Equity Fund (Growth)

Launched in 2020, the Axis Bank ESG Equity Fund already has an AUM of Rs 1,496.549 crore. The fund has given 14.2 per cent returns since it began operations.

ICICI Prudential ESG Fund (Growth)

The ICICI Prudential ESG Fund (Growth) has Rs 1,216.539 crore worth of assets under management. The investment has given 12.2 per cent returns in the past year. If you wish to make a lump sum investment in the funds, the minimum amount required is Rs 5,000.

Kotak ESG Opportunities Fund (Growth)

This MF investment does not have a lock-in period. Investors get the option to invest as little as Rs 1,000 per month through a SIP. The Kotak ESG Opportunities Fund has an AUM of Rs 1,100.464 crore.

Aditya Birla Sun Life ESG Fund (Growth)

With an AUM of Rs 800.499 crore, the MF has given 8.5 per cent returns in the past year. The Aditya Birla Sun Life ESG Fund requires a minimum SIP of Rs. 1,000 per month.