The new CFA ESG curriculum

The CFA Institute's Certificate in ESG Investing Exam curriculum (Version 4) has been revised for 2023.

CFA Institute Timeline

For candidates who enroll in the course on or after December 1, 2022, these changes will apply:

  • Candidates who enroll after December 1, 2022, will sit for the Version 4 exam.
  • Version 3 exams will be available until December 31, 2022
  • The exam will not be offered in January 2023
  • Starting on February 1, 2023, candidates can take the new exam


As we currently still have candidates preparing for the version 3 exam, we will update the material to version 4 on January 1st, 2023. If you have already purchased your package, you do not need to do anything as the new material will be automatically uploaded to our platform.

  • This includes updated questions, a new exam format (3 multiple choice questions instead of 4, no item sets)
  • Updated summary notes that are more detailed, as some have requested
  • Version 3 live until 31 Dec, 2022
  • Version 4 questions and summary notes will be uploaded on Jan 1st, 2023

CFA Institute Certificate in ESG Investing 2023 Curriculum

All candidates for the Certificate in ESG Investing exam should be familiar with the latest course material. In order to provide a seamless transition for those taking the exam again, we would like to highlight the changes. For those enrolling for the first time, this presents a good opportunity to gain an overview of the Version 4 syllabus.

After reviewing the new curriculum, we believe many facts and figures have been updated to reflect the latest developments. By and large, the overall changes are limited. We would estimate that the changes account for 15% of the curriculum, with Chapters 1-3 carrying the bulk of the changes. Further details below.



Topic Weight

Learning Objectives

Question Allocation

Overview of ESG Investing and Market




Environmental Factors




Social Factors




Governance Factors




Engagement and Stewardship




ESG Analysis, Valuation, and Integration




ESG Integrated Portfolio Construction and Management




Investment Mandates, Portfolio Analytics, and Client Reporting




2023 CFA Institute Certificate in ESG Investing Curriculum Updates

In addition to the content below where we highlight the learning objectives and key changes, we have recently launched the "Brainie Series" where we guide candidates on each chapter. If you enjoy the videos, please share your "thumbs up" and follow Brainie - thank you.

Chapter 1: Overview of ESG Investing

Watch Luca’s comment to Chapter 1 in the Brainie Series.


Learning Objectives:

1.1.1 define ESG investment and different approaches to ESG investing: responsible investment, socially responsible investment, sustainable investment, best-in-class investment, ethical/values-driven investment, thematic investment, green investment, social investment, shareholder engagement

1.1.2 define the following sustainability-based concepts in terms of their strengths and limitations: corporate social responsibility and triple bottom line (TBL) accounting

1.1.3 describe the benefits and challenges of incorporating ESG in decision making, and the linkages between responsible investment and financial system stability

1.1.4 explain the concepts of the financial materiality of ESG integration, double materiality, and dynamic materiality and how they relate to ESG analysis, practices, and reporting

1.1.5 explain different ESG megatrends, their systemic nature, and their potential impact on companies and company practices

1.1.6 explain the three ways in which investors typically reflect ESG considerations in their investment process

1.1.7 explain the aims of key supranational ESG initiatives and organizations and the progress achieved to date


Key Changes:

  • Additional definitional content on "Thematic investing" to match content in CFA Program
  • Additional definitional content on "Impact investing" to match content in CFA Program
  • Added content on "the evolution of materiality: from static to dynamic" and added examples of "double materiality
  • Added results of a NYU study on the link between ESG and financial performance.
  • New content on: Glasgow Financial Alliance for Net Zero (GFANZ)
  • New content on: International Business Council ESG Disclosure Framework, International Sustainability Standards Board (ISSB), and Corporate Sustainability Reporting Directive (CSRD)
  • Added an introduction to: CFA Institute Global ESG Disclosure Standards for Investment Products


Removed Content

  • Removed mini-case on Unilever
  • Removed reference to top 100 sustainable global companies

Chapter 2 - The ESG Market

Watch Luca’s comment to Chapter 2 in the Brainie Series.

Learning Objectives:

2.1.1 explain the history of ESG investing

2.1.2 explain the size and scope of ESG investing in relation to geography, strategy, investor type, and asset class

2.1.3 explain key market drivers of ESG integration: investor demand/intergenerational wealth transfer, regulation and policy, public awareness, and data sourcing and processing improvements

2.1.4 explain the key drivers and challenges for ESG integration among key stakeholders: asset owners, asset managers, fund promoters, financial services, policymakers and regulators, investees, government, civil society, and academia

Key Changes:

  • Added reference to COVID-19 pandemic and the increased geopolitical tensions leading to the war in Ukraine as examples of the interdependence between societies, economies, and financial markets
  • As of 2020, the largest sustainable investment strategy globally was ESG integration, previously (in V3) it was "exclusionary/negative screening"
  • Added a new Case Study on ABP (Dutch) Pension Plan: In September 2021, Dutch pension fund for educational workers and civil servants ABP announced that it will divest its entire EUR 15 billion worth of investments in fossil fuel producers by 2023. ABP is the 5th largest pension fund in the world and stated that ‘radical change’ is needed as global temperatures are projected to rise beyond 1.5 degrees in the next seven years.
  • New content added on various regulations and disclosures such as:
    • Global- Task Force on Climate-related Financial Disclosures (TCFD),
    • Europe--EU Taxonomy Regulation, and Sustainable Finance Disclosure Regulation (SFDR),
    • China- guidelines for green financial system, green asset taxonomy, and PBoC 2021-2025 strategy, and
    • North America-- 2022 SEC proposal

Removed Content:

  • Concept of “Long-termism & ESG” moved from Chapter 2 to Chapter 1

Chapter 3 - Environmental Factors

Watch Luca’s comment to Chapter 3 in the Brainie Series.

Learning Objectives:

3.1.1 explain key concepts relating to climate change, including climate change mitigation, climate change adaptation, and resilience measures

3.1.2 explain key concepts related to other environmental issues, including pressures on natural resources, including depletion of natural resources; water; biodiversity loss; land use and marine resources; pollution; waste; and a circular economy

3.1.3 explain the systemic relationships between business activities and environmental issues, including systemic impact of climate risks on the financial system; climate-related physical and transition risks; the relationship between natural resources and business; supply, operational, and resource management issues; and supply chain transparency and traceability

3.1.4 assess how megatrends influence environmental factors; environmental and climate policies; international climate and environmental agreements and conventions; international, regional, and country-level policy and initiatives; carbon pricing

3.1.5 assess material impacts of environmental issues on potential investment opportunities, corporate and project finance, public finance initiatives, and asset management

3.1.6 identify approaches to environmental analysis, including company-, project-, sector-, country-, and market-level analysis; environmental risks, including carbon footprinting and other carbon metrics; the natural capital approach; and climate scenario analysis

3.1.7 apply material environmental factors to financial modeling, ratio analysis, and risk assessment

3.1.8 explain how companies and the investment industry can benefit from opportunities relating to climate change and environmental issues: the circular economy, clean and technological innovation, green and ESG-related products, and the blue economy

Key Changes:

  • Updated content added from the 2021 Intergovernmental Panel on Climate Change (IPCC) report.
  • Additional content on biofuels, and pro-forestation.
  • Updated the fact that now 6 of the 9 planetary boundaries have been breached (as opposed to 4 boundaries) with the addition of freshwater (green water boundary); and novel entities (including plastic pollution); and
  • New content on the "green recovery" in the aftermath of Covid19.
  • Added content from the Summary for Policy Makers for the 2022 IPCC Report on Impact, Vulnerability and Adaptation--showing a strong connection between biodiversity, ecosystems, development and climate change.
  • New content on Fisheries Management.
  • New "Case study" on 'Scope 3 in the spotlight': For companies in certain industries, the highest contribution to their overall car-bon footprint comes from outside ‘the factory gates’. In the case of the fossil fuel industry, for example, most emissions do not come from the extraction and processing of coal, oil, and gas, but from the use of such products by consumers in vehicles, power plants and steel mills around the world.
  • New section on: UN Framework Convention on Climate Change (1992) as background to the Kyoto Protocol and the Paris Agreement.
  • New section on: Glasgow Climate Pact (2021) which captures key outcomes of the COP26 Conference in Glasgow in 2021.
  • A new section SDFR categorisation of ESG integration (Article 6, 8, and 9) plus discussion on the proposed Corporate Sustainability Reporting Directive (CSRD) (which would replace and strengthen the existing EU requirements around non-financial reporting).
  • Additional content on “Network for Greening the Financial System” (NGFS) and “Carbon Taxation.”
  • A new section on "Carbon Offsets" was added.
  • New content on the ‘ESG upside’ for large, listed companies.
  • A new case study on "the carbon risk premium."
  • New content Introducing the “Partnership for Carbon Accounting Financials” (PCAF).
  • Added a new figure showing the falling costs and growing adoption of various clean energy technologies.
  • A new section on Hydrogen:"hope or hype."
  • Additional content on efforts in UK, USA, China, India, Japan, and Australia with a few key points:
    • UK Government unveiled ‘Greening Finance: A Roadmap to Sustain-able Investment’
    • USA: 1) Federal Reserve has launched a Financial Stability Climate Committee and a Supervision Climate Committee and 2) SEC proposals
    • China published its roadmap to net zero carbon by 2060
    • Japan: multiple policy workstreams, including a new clean energy strategy, the development of a ‘Sustainability Standards Board of and the introduction of climate ‘stress-testing’ in the banking sector

Removed Content

  • The following quote was removed: “Clean energy technologies generally require more minerals than fossil fuel-based counterparts. An electric car uses five times as much minerals as a conventional car and an onshore wind plant requires eight times as much minerals as a gas-fired plant of the same capacity.” The quote was removed because it oversimplifies a complex issue. 

Chapter 4- Social Factors

Watch Luca’s comment to Chapter 4 in the Brainie Series.

Learning Objectives:

Learning objectives

4.1.1 explain the systemic relationships and activities between business activities and social issues, including: globalization; automation and artificial intelligence (AI); inequality and wealth creation; digital disruption, social media, and access to electronic devices; changes to work, leisure time, and education; changes to individual rights and responsibilities and family structures; changing demographics; urbanization; and religion

4.1.2 assess key megatrends influencing social change in terms of potential impact on companies and their social practices: climate change; transition risk; water scarcity; pollution; mass migration; and loss and/or degradation of natural resources and ecosystem services

4.1.3 explain key social concepts, including: human capital: development, employment standards, and health and safety; product liability/consumer protection: safety, quality, health and demographic risks, and data privacy and security; stakeholder opposition/controversial sourcing; social opportunities: access to communications, finance, and health and nutrition; social and news media; animal welfare and microbial resistance

4.1.4 assess material impacts of social issues on potential investment opportunities and the dangers of overlooking them, including: changing demographics; digitization; individual rights and responsibilities; family structures and roles; education and work; faith-based ESG investing and exercise of religion; inequality; and globalization

4.1.5 identify approaches to social analysis at country, sector, and company levels

4.1.6. apply material social factors to: risk assessment; quality of management; ratio analysis; and financial modelling

Key Changes:

  • Investor initiatives: equitable circulation of Covid-19 vaccinations.
  • New content added on "Double Materiality Reporting" and that the assessment of material negative impact, the following can be used:
    • the OECD Due Diligence Guidance for Responsible Business Conduct and
    • UN Guiding Principles on business and human rights
    • Added content on “double materiality” to the legacy cases on: Amazon, Apple/Foxconn, and Thai Union

Chapter 5 – Governance Factors

Watch Luca’s comment to Chapter 5 in the Brainie Series.

Learning Objectives:

5.1.1 explain the evolution of corporate governance frameworks: development of corporate governance; roles and responsibilities; systems and processes; shareholder engagement; minority shareholder alignment

5.1.2 assess key characteristics of effective corporate governance, and the main reasons why they may not be implemented or upheld: board structure, diversity, effectiveness, and independence; executive remuneration, performance metrics, and key performance indicators (KPIs); reporting and transparency; financial integrity and capital allocation; business ethics

5.1.3 assess and contrast the main models of corporate governance in major markets and the main variables influencing best practice: extent of variation of best practice; differences in legislation, culture, and interpretation

5.1.4 explain the role of auditors in relation to corporate governance and the challenges in effective delivery of the audit: independence of audit firms and conflicts of interest; auditor rotation; sampling of audit work and technological disruption; auditor reports; auditor liability; internal audit

5.1.5 assess material impacts of governance issues on potential investment opportunities, including the dangers of overlooking them: public finance initiatives; companies; infrastructure/private finance vehicles; societal impact

5.1.6 apply material corporate governance factors to: financial modeling; risk assessment; quality of management

Key Changes:

  • Expanded 10 of the legacy mini-case studies with additional information/data on the following: Enron, Tyco, HIH, Worldcom, Ahold, Parlamat, Satyam, Olympus, Volkswagen, and Wirecard. (Also, added the name of the country of each company--many candidates might not know this).
  • Additional content added on board structures and governance.
  • New content added on International Sustainability Standards Board (ISSB).
  • New content on "Corporate governance in the UK."
  • New content on ESG Audits (methods and examples of issues).

Removed Content

  • Removed 4 of the legacy mini-case studies: Polly Peck, Maxwell, and BCCI.

Chapter 6 - Engagement and Stewardship

Watch Luca’s comment to Chapter 6 in the Brainie Series.

Learning Objectives:

6.1.1 explain the purpose of investor engagement and stewardship

6.1.2 explain why engagement is considered beneficial and some of the key criticisms of engagement

6.1.3 explain the main principles and requirements of stewardship codes as they apply to institutional asset management firms: UK Walker Review (2009) and Stewardship Code (2020); US Employee Retirement Income Security Act (ERISA) guidelines; EU European Fund and Asset Management Association (EFAMA) Stewardship Code

6.1.4 explain how engagement is achieved in practice, including key differences in objectives, style, and tone

6.1.5 apply appropriate methods to establish an engagement approach: strategy and tactics-goal-setting; identifying who to talk with; formalities-hosting/agenda/managing expectations; communication-approach/tone/managing tensions; working towards agreement; escalation techniques, including collective engagement; ESG investment forums; proxy voting

6.1.6 describe approaches of engagement across a range of asset classes

Key Changes:

  • Updated facts and figures in general, but no adjustments to content

Chapter 7 - ESG Analysis, Valuation, and Integration

Watch Luca’s comment to Chapter 7 in the Brainie Series.

Learning Objectives:

7.1.1 explain the aims and objectives of integrating ESG into the investment process

7.1.2 describe different approaches of integrating ESG analysis into the investment process

7.1.3 describe qualitative approaches to ESG analysis across a range of asset classes

7.1.4 describe quantitative approaches to ESG analysis across a range of asset classes

7.1.5 identify tangible and intangible material ESG-related factors through both qualitative and quantitative approaches

7.1.6 describe how scorecards may be developed and constructed to assess ESG factors

7.1.7 assess ESG issues using risk mapping methodologies

7.1.8 explain how ESG complements traditional financial analysis

7.1.9 analyze how ESG factors may affect industry and company performance

7.1.10 analyze how ESG factors may affect security valuation across a range of asset classes

7.1.11 interpret a company’s disclosure on selected ESG topics

7.1.12 apply the range of approaches to ESG analysis and integration across a range of asset classes

7.1.13 describe the challenges of undertaking ESG analysis across different geographic regions and cultures

7.1.14 describe the challenges of identifying and assessing material ESG issues

7.1.15 describe the challenges of integrating ESG analysis into a firm’s investment process

7.1.16 explain the approaches taken across a range of ESG integration databases and software available, and the nature of the information provided

7.1.17 identify the main providers of screening services or tools, similarities and differences in their methodologies, and the aims, benefits and limitations of using them

7.1.18 describe the limitations and constraints of information provided by ESG integration databases

7.1.19 describe primary and secondary sources of ESG data and information

7.1.20 describe other uses of ESG and sustainability systems data

7.1.21 explain how Credit Rating Agencies (CRAs) approach ESG Credit Scoring

Key Changes:

  • Updated facts and figures in general, but no adjustments to content

  • Moved the appendix on “Sustainalytics” and “MSCI” to the end of the chapter, after the questions and before the “further reading.”

Chapter 8 – ESG Integrated Portfolio Construction and Management

Watch Luca’s comment to Chapter 8 in the Brainie Series.

Learning Objectives:

8.1.1 explain the impact of ESG factors on strategic asset allocation

8.1.2 describe approaches for integrating ESG into the portfolio management process

8.1.3 explain approaches for how internal and external ESG research and analysis is used by portfolio managers to make investment decisions

8.1.4 explain the different approaches to screening and the benefits and limitations of the main approaches

8.1.5 explain the main indexes and benchmarking approaches applicable to sustainable and ESG investing, noting potential limitations

8.1.6 apply ESG screens to the main asset classes and their sub-sectors: fixed income; equities; and alternative investments

8.1.7 distinguish between ESG screening of individual companies and collective investment funds: on an absolute basis; relative to sector/peer group data

8.1.8 explain how ESG integration impacts the risk–return dynamic of portfolio optimization

8.1.9 evaluate the different types of ESG analysis/SRI investment in terms of key objectives, investment considerations, and risks: full ESG integration; exclusionary screening; positive alignment/best-in-class; active ownership; thematic investing; impact investing; other

8.1.10 describe approaches to managing passive ESG portfolios

Key Changes:

  • Update to sovereign debt section describing US sanctions on Russia following its 2014 annexation of Crimea extended to Russian sovereign debt by adding the following: Similarly, the Russian invasion of Ukraine in 2022, led to global sanctions that effectively restricted trading in Russian sovereigns.61
  • A summary chart on SFDR classification is provided.
  • New content on: The principle of DNSH (Do No Significant Harm): which was introduced in the Technical Expert Group Final Report of the EU Sustainable Finance Taxonomy.
  • Additional content on standards on ESG Investing including from CFA Institute (Global ESG Disclosure Standards for Investment Products.) and IOSCO.

Chapter 9 - Investment Mandates, Portfolio Analytics, and Client Reporting

Watch Luca’s comment to Chapter 9 in the Brainie Series.

Learning Objectives:

9.1.1 explain why mandate construction is of particular relevance and importance to the effective delivery of ESG investing: linking sustainable investing to the mandate; defining the sustainable investment strategy

9.1.2 explain how ESG screens can be embedded within investment mandates/portfolio guidelines to generate investment returns and manage portfolio risk

9.1.3 explain the most common features of ESG investing that asset owners and intermediaries, including pension consultants and fund selectors, are seeking to identify through request for proposal (RFP) and selection processes: voting, engagement, examples of decision making, and screening process

9.1.4 explain the different client types and their objectives which influence the type of ESG investing strategy selected

9.1.5 explain the key mechanisms for reporting on and monitoring performance and mandate alignment with client objectives

9.1.6 explain the key challenges in measuring and reporting ESG-related investment performance: active, passive, and smart beta approaches; performance attribution; sensitivity analysis; risk measurement; engagement activity/impact; and integrated reporting and investment review:

Key Changes:

  • Updated facts and figures in general, but no adjustments to content

  • A new appendix on “SFDR disclosures” and “CFAI ESG Disclosure standards” added to the chapter.