Addressing Behavioral Biases in Sustainable Investing

As a wealth manager, you are tasked with advising high-net-worth individuals on their investment strategies. One of your clients, Mrs. Johnson, has expressed a desire to invest in sustainable companies due to her personal values. However, she is also concerned about the potential trade-offs between returns and ethical investments.

You believe Mrs. Johnson's investment choices may be influenced by cognitive biases, such as overconfidence and her emotional attachment to sustainable investing. In 600-800 words, discuss how you would address Mrs. Johnson's biases and concerns in the context of her investment portfolio. Include specific strategies to balance her ethical considerations with the need for risk-adjusted returns, and explain how understanding behavioral finance principles can enhance your wealth management approach.