While ESG investing has encountered some turbulence in early 2025, several standout performers have emerged that merit investors’ attention this April. The sector’s recent $6.76 billion decline in assets under management hasn’t stopped certain funds from delivering eye-popping returns that would make even the most stoic investor raise an eyebrow.
Leading the performance parade is BNY Mellon Women’s Opportunities ETF (BKWO), boasting a whopping 43.16% annual return. It’s like BKWO didn’t just break the glass ceiling—it installed a skylight. Close behind, Franklin Responsibly Sourced Gold ETF (FGDL) shines bright with a 41.96% return, proving that environmentally responsible gold mining isn’t just ethical—it’s profitable.
For investors watching their wallet (who isn’t these days?), cost-effective options abound. TCW Transform 500 ETF (VOTE) charges a microscopic 0.05% expense ratio—that’s like paying a nickel to manage $100 annually. Xtrackers MSCI USA Climate Action Equity ETF (USCA) follows at 0.07%, while iShares ESG Select Screened S&P 500 ETF (XVV) rounds out the top three budget-friendly options at 0.08%. When considering low volatility options, the SPDR SSGA US Large Cap Low Volatility Index ETF showed impressive returns of 5.73% in Q1 with a reasonable 0.12% expense ratio.
The ESG landscape is evolving faster than fashion trends. Environmental-focused funds attracted $550 million in February alone, while their broader-focused counterparts saw outflows. This divergence suggests investors are getting pickier about their sustainable investments—less “kumbaya around the campfire” and more “show me the environmental impact.” Some forward-thinking investors are exploring how DeFi solutions could eventually transform ESG verification and reporting through blockchain transparency.
International ESG offerings are gaining momentum too, with European markets seeing 74% year-over-year growth in some segments. The recent performance of the MSCI ACWI ex USA Index with its impressive 4.03% gain demonstrates international stocks’ growing appeal. Meanwhile, sector-specific performance varies dramatically, with ESG Health funds leading the pack in January with 7.48% gains.
Long-term data continues to support the ESG proposition, with select indices outperforming conventional benchmarks over five and ten-year periods. Despite the recent market hiccups, ESG ETFs’ combination of transparency, performance potential, and increasingly competitive fees suggests they’re not just a passing investment fad—they’re becoming financial furniture.
