Guide to CFA Exam Prep and Study Materials: Navigating the ESG Investing Landscape

The Rise of ESG Investing

Over the past decade, ESG investing has moved from a niche to a core aspect of the financial landscape. Whether you're talking about climate change, stewardship and engagement, or social factors, these elements have now become central to companies and asset managers' ESG decisions.

The CFA Institute was quick to recognize the importance of this shift, leading to the development of the CFA Institute Certificate in ESG Investing. The curriculum provides comprehensive insights into the ESG factors that influence modern investment practices. As investors increasingly demand transparency, the ability to analyze environmental, social, and governance factors is now essential.

Furthermore, the curriculum dives into the regulatory landscape, like SFDR articles 6-9, UN PRI, and sector-related sustainability challenges like wastewater treatment in mining and governance issues in large corporations. It also highlights the trade-off between accessibility of information, the lack of standards that make it difficult to compare across sectors, and lessons learned from past events like Enron or Wirecard.

What You Need to Know About the CFA ESG Certificate

First things first. Many employees from the financial industry know about the CFA program. As a result, we often receive the question: is the ESG Investing certificate also suited for non-financial employees?

The short answer: Yes, it is. As stated earlier, the certificate in ESG investing not only provides frameworks and practical examples on how to integrate ESG into company valuation, stewardship and engagement, and sector-related analysis.

The syllabus goes beyond investing and highlights regulatory challenges across geographies and sectors, the access to robust data, the need for standardized disclosure, and provides real-world examples where needed. In addition, it provides an overview of the term ESG, its historic development, and strategies to manage various stakeholders accordingly.

If you’re preparing to take the CFA Institute Certificate in ESG Investing, here’s a breakdown of what to expect:

• Exam Format: The exam is online or in-person and consists of 100 multiple-choice questions. These questions range from testing knowledge of key concepts to how ESG is integrated into everyday investment scenarios.

• Study Materials: The official CFA ESG syllabus includes nine chapters, covering everything from an introduction to ESG to ESG-integrated portfolio construction and management. Each chapter is crucial for a well-rounded understanding of ESG analysis and portfolio analytics.

• Time Commitment: The recommended study time is 130 hours, though some candidates complete it in less. Whether you’re new to ESG investing or have a background in finance, the CFA ESG syllabus is designed to be accessible to a broad range of participants.

Want to know if the CFA ESG is worth it?

Best Study Materials for the CFA ESG Certificate

The best study materials for the CFA ESG Certificate can vary depending on your learning style and background. Although we are convinced we offer the best prep material for the ESG Investing certificate, here are some options to consider:

1. Official CFA Institute Syllabus: This is the gold standard and should be the foundation of your prep. It covers the entire ESG investing curriculum, including concepts like governance factors, ESG portfolio analytics and integration, company management (including the board of directors), valuation, and case studies.

2. Third-Party Study Guides: Providers like Brainie offer comprehensive third-party prep materials, which include additional resources such as PDF summary notes and interactive chapter tests. Our CFA ESG course is designed to complement the official materials, often simplifying complex topics and providing practical examples to reinforce learning.

3. Video Lectures and Webinars: If you're a visual learner, video lectures or webinars can be incredibly helpful. Platforms such as Kaplan Schweser, Fitch Learning, Analyst Prep, and Brainie offer video-based learning, breaking down the concepts in an engaging way. These sessions can be particularly useful for grasping difficult topics like ESG integration and portfolio analytics.

Want to learn more? Read here how to pass CFA ESG

Recommended Textbooks and Publications

For those who prefer in-depth reading, there are several publications that can enhance your understanding of ESG investing:

• CFA Institute Official Texts: The curriculum includes and references a wide range of academic papers, websites, industry reports, and NGO reports.

• The Principles for Responsible Investment (PRI) Reports: A great additional resource, these reports provide real-world examples of how ESG is integrated into investment decisions, offering insights beyond the curriculum.

Where to Find Practice Questions and Mock Exams

Mock exams and practice questions are crucial for exam success, helping you familiarize yourself with the format and style of questions. Here’s where you can find the best resources:

• Brainie: Brainie offers over 500 practice questions designed to test your understanding of the core topics in the CFA Institute Certificate in ESG Investing. These questions mirror the actual exam format and come with detailed explanations, making them a valuable resource for self-assessment.

• CFA Institute: The official website also offers sample questions and resources, which can give you a clear idea of what to expect on exam day.

• Kaplan Schweser: Another prep provider, Kaplan offers mock exams that simulate the actual exam experience, allowing you to gauge your preparedness and identify areas for improvement.

How Comprehensive Are Third-Party Study Guides Compared to Official Materials?

Third-party study guides can be incredibly useful as supplementary material, but they should not replace the official study materials provided by the CFA Institute. While the official content is aligned with the exam syllabus, third-party providers like Brainie offer more practical insights, including concise summaries that make studying more efficient. They also offer freebies like PDF downloads of short guides, which can be helpful for quick reviews.

Are Video Lectures and Webinars Effective?

Absolutely! For many candidates, video lectures and webinars are an effective way to enhance preparation and grasp complex concepts quickly. They allow for flexibility and often break down difficult topics like ESG valuation, client reporting, and portfolio construction into digestible parts. Video content is especially useful if you struggle with more traditional reading materials and prefer interactive learning.

Freebies and PDFs: Enhance Your Study Experience

Many third-party providers, including Brainie, offer free PDFs and summary notes to help you study more effectively. These PDFs provide overviews of key topics, such as governance factors, ESG integration, and the ESG market, and are perfect for on-the-go revision. Additionally, some platforms offer free practice questions, allowing you to test your knowledge without any upfront cost.

Conclusion: The Path to CFA ESG Investing Success

If you're preparing for the CFA Institute Certificate in ESG Investing, having access to the right resources is key. From official CFA ESG study material to third-party guides, realistic mock exams, and webinars, there’s no shortage of tools to help you succeed. The certification is more than just a qualification—it’s an investment in your future as an expert in sustainable investing and ESG analysis.

Whether you’re a seasoned professional or new to the field, passing the CFA ESG exam is achievable with the right preparation. Start by reviewing the CFA Institute’s official materials, then supplement your learning with third-party guides, practice questions, and video lectures. Platforms like Brainie also offer affordable and comprehensive resources to help you on your journey.

Ready to dive in? Contact Brainie to receive free PDF study guides and access the tools you need to excel in your ESG journey.