For many of us, January and February are times of transition—leaving old ideas and habits in the past as we adapt to new ones. And it looks like we can finally leave behind some old-school thinking about ESG and performance. Lost among the (hopefully) short-term gyrations of a very volatile stock market over the past two weeks was new analysis from Morningstar that shows in 2021, sustainable index funds performed as well or better than traditional funds, with an average return of 29.2% compared to 28.7%. What’s more, seven of the 13 ESG index funds available to US investors delivered returns over 30%. And the two-year comparison data looks even better.

This evidence comes on the back of multiple years of dramatic growth of capital flowing into ESG ETFs, and debunks claims that investing with both financial and sustainable goals is “concessionary.” Better ESG performance is not a trade-off for financial returns. As commitments to diversity and sustainability start to bear fruit—State Street’s push for more diverse corporate boards is a recent excellent example—we hope to see even more proof points that a more just and conscious economy generates returns for all.