ESG and Carbon Neutrality Goals: Literature Review and Investment Strategy Analysis

Against the backdrop of escalating global climate change and the pressing urgency to mitigate environmental impacts, achieving carbon neutrality has become a critical focus in transitioning to a sustainable low-carbon economy on a global scale. Within this context, Environmental, Social, and Governance (ESG) frameworks play an increasingly recognized and essential role in supporting low-carbon economic development across various sectors. This paper systematically reviews the role of ESG in achieving carbon neutrality, exploring its effectiveness not only in selecting low-carbon enterprises but also in facilitating the development of robust low-carbon investment strategies. Through a comprehensive literature review, it reveals how ESG frameworks enable companies to undertake low-carbon transformation initiatives and delves into the application of relevant investment tools, assessing their significant contributions to carbon neutrality goals. Additionally, this paper addresses the persistent challenges faced by ESG frameworks, including issues of standardization, transparency, and accountability, and proposes future research directions alongside actionable suggestions to improve the ESG framework to better support the global pursuit of carbon neutrality and a more sustainable future.