Lately, our team has been getting a lot of questions about how they can earn high dividends from investing in ethical shares and ETFs on the ASX. Here we’ll explore high dividend and high yield ETFs available in Australia and how to make ethical decisions about your investments. 

There are two ways you can earn a financial return on your shares. The price of the shares goes up (or down). The other way is when the company pays you some of their profit to their shareholders. This second way is known as a dividend. This is also sometimes called a distribution. 

The companies that pay the highest dividends tend to share the same characteristics: a very large company; makes a lot of profit; and has been around a long time. 

Conversely, the companies that pay lower dividends, or no dividends, tend to be smaller companies, have been around for less time, and  are re-investing their profits (if they have some) into growing the company instead of giving that money to shareholders. 

This means that the largest companies on the ASX that pay the highest dividends are usually the companies that many ethical investors try to avoid. The highest dividend paying sectors are Resources (i.e. mining), Energy (i.e. fossil fuels), Utilities and Financials (i.e. the big banks). 

Sectors that ethical investors tend to favour like Healthcare, Technology and Communications, have historically paid the lowest dividends. 

So if you’re investing for ethics you need to look a little deeper to find higher dividends from companies that can satisfy your ethical values. The table below shows examples of companies that often feature in ethical share ETFs that have paid a higher dividend than the ASX average, which is 3.3% according to Morningstar’s 2026 numbers.

As always, this list isn’t a recommendation to buy these companies. If you’d like to read more about what these companies do then check out the ethical profile available for SIX customers here.

Our ethical profiles are written and researched by our ESG team and give our investors a summary of what to look out for when they decide whether to invest in a stock.

While some of the common ETFs like Vanguard’s High Dividend Yield ETFs (VHY, VIHY) are often part of the conversation, we want to highlight stocks that have ethical screens.

The iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ticker code: IHD) is an ASX-listed high dividend ETF that has some ethical screening. It removes out companies heavily involved in the production or distribution of tobacco, alcoholic beverages, gambling operations and fossil fuels. So you won’t see companies like Woodside, Origin Energy, Wesfarmers, and the Lottery Corporation, which appear in non-ethical high dividend ETFs. It’s worth noting the top holdings do include BHP (which has some fossil fuels) and the big banks. At the end of August 2026, it published a yield of 4.04%.

Another is Perpetual ESG Australian Share Active ETF (ASX:GIVE). This has stricter ethical screens than IHD for things like animal cruelty and nuclear, and has a 2nd 'ESG' screen which focus on how a business operates as well as what it does. The main difference ethicallly between GIVE and IHD is GIVE invests in the big banks but not the big miners. You can see the full holdings here. At the end of July 2026, the fund published a yield of 3.1%.

If it’s income you’re looking for, then you can check out an ethical fixed interest ETF. The Janus Henderson Sustainable Credit Active ETF (ASX:GOOD) has the strictest ethical screens and some impact bonds. Note that as a fixed income fund, this is generally aiming for income over capital growth (lower return with lower risk) than a high dividend fund that is seeking earnings from both share price gains as well as dividends.

Let us know if this helped you make a decision about what to invest in and tell us what else you’d like to hear from us.