The ESG funds are becoming more and more popular. (ESG = Environmental, Social and Governance). But I am wondering if it makes sense for stock funds?
If you buy a stock fund, the only consequence is that you become a player on the stock market, but your money will not transfered to any "bad" company in the stock fund. So why should I care about the portfolio of the fund?
Clearly, if you buy a fund that includes corporate bonds, then you finance companies, i.e. you could finance, e.g., weapons or child labor. In this case ESG funds are very useful.
But for pure stock funds, what is the point with ESG?
Edit: This question is very similar to the question "if buying a stock means to support the company". However, one difference is, e.g., that if you buy a fund you can not participate at a annual general meeting and you are not a legal shareholder of the companies. So with a stock fund you are only a speculator but with a stock you are also a owner. So it could be a reasonable and responsible strategy to select stock funds according to risk/profit and to select bonds (or other assets that directly support the company) by ESG criteria. In this way one could transfer money from non-ESG companies to ESG-companies.
Edit2: All funds I have are ESG funds. But I was wondering if this has any positive impact. This is why I asked this question. So please don't downgrade my question to tell me that I am irresponsible or ignorant. This is not the case.