The Russia-Ukraine War: Investor Implications and Reactions

Written by Elizabeth Umlas

February 24, 2023

This view is published jointly by Croatan Institute and the US SIF Foundation and cites survey response data collected for the 2022 Report on US Sustainable Investing Trends. We are publishing the view today to mark the first anniversary of Russia’s invasion of Ukraine.


Investor reactions to Russia’s invasion of Ukraine in February 2022 came swiftly. The Heartland Initiative and the Investor Alliance for Human Rights (IAHR), for example, strongly condemned Russia’s aggression[1] and called on companies and investors to undertake enhanced due diligence to ensure they were not complicit in violations of international humanitarian or human rights law.[2]

Criticism came from within and outside of the sustainable investment community regarding investors’ being too slow to react[3] or for having enabled the Putin regime through years of investment in Russian companies.[4] Others strongly rejected the notion that weapons should now be considered “socially responsible investments” simply because Ukraine needed them to defend itself.[5] Interestingly, index providers moved with record speed to remove Russian equities and bonds from their ranks, leading one large asset manager to observe that even passive funds could divest rapidly when pushed.[6]

The US SIF Foundation’s data request for its 2022 Report on US Sustainable Investing Trends included an optional question that asked: “How will US sustainable investing evolve by 2025, particularly in the wake of geopolitical conflicts such as the Russia-Ukraine war?” Twenty-two recipients responded, including 14 money managers with $197 billion in total assets under management, and institutional investors representing foundations, faith-based institutions, family offices, non-profits and public pension funds. The main themes that emerged from this question were related to human rights, the rise in conflict-affected areas, the energy transition and the role of environmental, social and governance (ESG) factors. These were a few of the reactions to the question:

“The Russia-Ukraine conflict fits squarely at the intersection of ESG and fundamental factors that we look at when both conducting research and advising our clients on portfolio construction that seeks to generate both returns and broader impact to the global society.”

“[It] has already caused many asset owners to look at their exposure to geopolitical risk in a new light and more explicitly in terms of human rights.”

“We also must deal with the transition of the global energy system to something that is not dependent on oil in a way that is fair and just to all people worldwide.”

 A number of respondents reflected on the war’s implications for sustainable investing. Some participants asserted that the invasion underscored investors’ need for better data and tools. Others emphasized that asset managers need to conduct more due diligence to address risks, particularly in relation to human rights, associated with conflict-affected areas.

But respondents also pointed out that the war in Ukraine was only one of many high-risk areas where human rights violations must be better addressed, and this conclusion is supported by data.  The number of people living near conflict has expanded rapidly since 2007.[7] Myanmar and China’s Xinjiang Uyghur Autonomous Region are just two other recent examples that raise questions about geopolitical risk for companies and investors.

Liz Umlas is a Senior Fellow at Croatan Institute. Learn more about her work here.


[1] “Investor Statement on the Crisis in Ukraine,” May 16, 2022,

[2] “Investor Alert: Human Rights Risks Related to the Russian Invasion of Ukraine,” Investor Alliance for Human Rights, March 3, 2022,

[3] John Streur, “Putin Gut Punches ESG Investing,” Calvert, March 15, 2022,

[4] See, for example, Sonia Kowal, “The investor response to the Russian war in Ukraine,” LinkedIn, March 7, 2022,

[5] “Investors and the Russian Invasion of Ukraine,” Shareholder Association for Research and Education, April 29, 2022,

[6] Dominic Webb, “Ukraine Invasion Shows Passive Managers Can Divest,” Responsible Investor, March 10, 2022,

[7] See