Completely agree.
I’d also add that there are plenty of situations where individuals are required to disperse funds which have already been earmarked for spending on a particular cause. For example, many large businesses have staff “LGBT+ inclusion committees” and provide funds which these committees are expected to donate to LGBT+ charities.
In this situation, whether or not charities focussed on improving the lives of LGBT+ people are more or less effective than others is irrelevant. The funds are earmarked for that purpose and so the task of the committee members is to determine which charities that fall under their remit are most impactful.
If discussion relating to how to do so is not welcome and encouraged in EA spaces then there is a risk that such evaluation won’t take place at all.
The argument isn’t necessarily that investing in ESG funds leads to a positive impact, so much as that it avoids a negative one. For example, consider two hypothetical investment funds:
Invests in the S&P 500 index
Invests in the S&P 500 index but excludes any company which manufactures or supplies landmines
All else being equal I think it’s difficult (although not impossible) to argue that shifting people away from fund 1 and toward fund 2 doesn’t have a net positive impact on the world. So I suppose the debate hinges primarily on whether all else is equal (i.e. in terms of fees, risk, and expected growth) and, if not, how to account for those differences within an ethical framework.
I agree with the criticisms you made but would add that some people who are uninterested in the EA maxim of “do the most good” may be convinced to “do the least harm”. If these people (who won’t be donating their investment gains to effective charities, regardless of how large those gains are) can be nudged towards more ethical products then this could have give a positive benefit.