I really like the idea of owning ASX-listed exchange-traded funds (ETFs) for my family because they make it easy to gain exposure to different share markets with diversified portfolios.

I think diversification within an ETF investment makes it much easier to stick with that ASX ETF because the combination of holdings is lower risk than just owning one business.

Additionally, as newer businesses succeed, they become a greater part of the fund's holdings, ensuring the ASX ETF's holdings remain relevant and the overall fund is future-proofed.

With that in mind, I like the two ASX ETF options below.  

BetaShares Global Sustainability Leaders ETF (ASX: ETHI)

This fund aims to invest in a diversified portfolio of large, sustainable, and ethical companies from a range of markets.

It starts with all of the businesses from the global share market and then makes a number of exclusions. For example, it excludes fossil fuels, gambling, tobacco, weapons, alcohol companies, payday lending, and so on. The ETHI ETF then owns the 200 largest climate-leading businesses that pass through all of those screenings.

I think 200 holdings is a large enough number for diversification, and they come from a variety of places, including the US, Japan, the Netherlands, the UK, Denmark, Canada, and so on.

This ASX ETF could be an appealing pick for investors who only want to make investment returns from companies that deliver a certain level of 'ethics' for their portfolio.

This fund's largest holdings are currently Nvidia, Apple, Visa, Mastercard, and Home Depot.

Coincidence or not, this fund has performed strongly, showing that owning ethical companies doesn't necessarily detract from returns. In the five years to 31 January 2025, the ETHI ETF has returned an average of 16.1%.

Vanguard Msci Index International Shares ETF (ASX: VGS)

For people who just want to invest in the global share market without necessarily making ESG investment decisions, the VGS ETF could be one of the most effective ways to go.

It's invested in more than 1,300 businesses from a wide range of major developed countries, including the US, Japan, the UK, Canada, France, Switzerland, Germany, the Netherlands, Sweden, Italy, Spain, Denmark, Hong Kong, Singapore, Finland, Belgium, Israel, Norway, and Ireland.

Companies are always trying to grow their profits over the long term, and they are giving themselves a great shot at growing their underlying value over time.

The businesses in this portfolio are typically the leader in their country at what they do, and the biggest holdings are among the strongest and most dominant in the world. The holdings include Apple, Microsoft, Amazon, Alphabet, Meta Platforms, Tesla, Broadcom, JPMorgan Chase and Eli Lilley.

Considering the amount of global diversification, I think the annual management fee is very reasonable at 0.18%.

The low cost and exposure to good businesses have helped the ASX ETF achieve net returns of an average of 13.9% per year over the past five years.