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Sustainable Investing

We Believe ESG Factors Are Pre-Financial Indicators

They have the power to shape a company’s financial viability and investors’ returns.

For more than 30 years, sophisticated and progressive ESG investors have chosen us for innovative solutions fit to withstand future market ebbs and flows. We help them by bringing clarity to investment opportunities and risks resulting from financially relevant environmental, social, and governance factors.
Our ESG Expertise
3 of the Top 10 Largest ESG Index Funds Managed Globally1
$162B AUM in Sustainable Investment Strategies2
Best Application of ESG & Smart Beta Manager3

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Portfolios Fit for the Future

As long-term investors, we craft portfolios to fit the needs of investors – today and in the future. More importantly, we recognize that when managed well, ESG factors can position a company for success but, when mismanaged, they can result in significant risks.

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Begins with a Clear View

Consistent with our risk-aware philosophy, we evaluate companies using ESG criteria coupled with quantitative research. This brings into focus the factors — or “pre-financial indicators” — that can impact their financial viability and clients’ long-term risk-adjusted returns.

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Requires Advocacy in Action

As early sustainability adopters and active industry advocates, we’ve worked hard to drive transparency in sustainable financial reporting and positive economic and societal change.

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Combines Active Stewardship with ESG Analysis

As one of the world’s largest investment managers, we appreciate our voice has influence. By combining ESG analysis with stewardship, we purposely and actively engage with companies we invest in to ensure sustainable practices and raise ESG standards — and use our proxy voting power to drive change.

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Northern Trust ESG Vector ScoreTM

Bring Greater Clarity to ESG Risk Assessment

We've spent more than three decades guiding some of the world's most progressive investors on their sustainable investing journeys, but we couldn't find a tool that could bring the clarity to ESG-related risk assessment that we needed.

So, we built one.

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Four-step approach

Rigorous Analysis Brings Opportunities & Risk into Focus

Financially relevant ESG information has the power to impact a company’s performance and, ultimately, investors’ long-term risk-adjusted returns. That’s why we employ rigorous analysis — and a four-step investment approach — to uncover this crucial information.

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Step One: Analyze

Bringing Clarity to ESG Investing

We analyze business-related ESG issues — financially material and industry-specific factors — that can shape short- and long-term results. Key to our process is our proprietary framework of measurable ESG targets and decades of practical experience building ESG portfolios.

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Step Two: Measure

Key to Performance: Priorities & Progress

We use external best-in-class ESG data4, proprietary research, analytics, and exclusionary screens to select key performance indicators to measure how well publicly traded companies perform on business-relevant, financially material ESG issues and topics.

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Step Three: Monitor

Separating the Leaders from the Laggards

We continually assess the sustainability performance of the securities in our ESG portfolios. We develop a comprehensive view — separating the leaders from the laggards — and flag companies that require additional research or targeted engagement.

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Step Four: Engage

Active Stewardship: The Power of Persuasion

Stewardship is an integral part of our investment process. We take an active ownership approach, identifying long-term risks that potentially affect shareholder value and engaging on substantive issues — those that can affect business on many levels.

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Related Products

U.S. Quality ESG Fund

The Fund seeks to invest primarily in large and mid-cap U.S. companies that have shown favorable environmental, social, and governance (ESG) characteristics and exhibit strong business fundamentals.

Learn More

Global Sustainability Index Fund

The Fund seeks to track the performance of the index by investing in companies that adhere to widely accepted sustainability principles. These principles might include stewardship of the environment, focus on safe, high-quality products and exemplary and ethical management.

Learn More

Quality ESG Strategies

Designed to outperform by investing in high quality companies that are well positioned to manage their ESG risks and opportunities relative to their industry peers.

Learn More

FlexShares STOXX US ESG Select Index Fund

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the STOXX USA ESG Select KPIs Index (the "Underlying Index").

FlexShares ESG & Climate US Large Cap Core Index Fund

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust ESG & Climate US Large Cap Core Index (the “Underlying Index”).

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