20 pledges for 2020: We asked the experts for their idea of a good green fund and manager

The next couple of editions of this column will provide you with their answers. First up: AJ Bell's Ryan Hughes with Lion Trust's Sustainable Future Global Growth fund

Google's owner Alphabet is one of the holdings of Liontrust's Sustainable Future Global Growth fund (REUTERS)

The problem with ethical investing is that people’s ethics differ and so do their standards.

It’s not just a fund’s risk profile, benchmark, and maybe performance against it that you have to consider (although you shouldn’t place too much reliance on past performance as the Financial Conduct Authority constantly warns). It’s also the fund’s ESG (ethical, social and governance) screening and how it works alongside your own personal values.

There is a wide range of ESG funds that range from light to dark green (the strictest level of screening) with various points in between.

There is also a wide range of fund managers offering them. Some made a commitment to this sort of product a long time ago but with going green now all the rage, they've been joined by plenty of Johnny-Come-Latelys who could be said to see green funds as more of a marketing ploy.

There is, as ever, no substitute for your own research, and particularly in this part of the market.

But having covered the subject of index tracker funds last time around, I thought I’d ask a couple of professionals for their idea of what a good actively managed ESG screened fund looks like to get you started.

First to step up to the plate is Ryan Hughes, head of active portfolios at AJ Bell, who kicks off by underlining the point that some managers are more sincere than others.

“ESG is without doubt the hottest topic in investment with just about every asset manager claiming that it sits at the heart of their investment process," he says.

“The reality is that many are only really just starting out on the ESG journey and it will take time for these managers to truly embed a proper ESG process into their investment thinking.”

Hughes suggests that people interested in this sort of fund focus their attention on companies that have been in the market for the long haul.

“Some asset managers have been thinking about ESG for many years and therefore for investors interested in this approach, I’d suggest that they look at the established players that have ESG in their DNA rather than those that are only just having the epiphany."

For Hughes, the Sustainable Future team at fund manager Liontrust fits the bill.

“They have been running investments in this manner for 20 years, giving them great heritage and insight as well as being able to have witnessed the change in sentiment that many companies have experienced as awareness of ESG has grown.”

The company, he says, has a good range for ethically minded investors to consider.

“Liontrust has a full suite of funds for investors including bond funds, multi asset funds and equity funds giving investors a huge choice of investments all following the sustainable approach.”

There is one in particular that he likes: “For long term investors the Sustainable Future Global Growth fund may be interesting.

“Large holdings include the likes of Alphabet (Google), Visa and Adobe demonstrating that investing in this manner can still done with a focus on very well-known companies. Liontrust have a lot of useful information on their website for investors looking to learn about ESG investing so it is a good place to start for many.”