ESG Investing All About Making Money While Doing Good

There is more to environmental, social and governance (ESG) investing than simply feeling good. There is also money to be made, said Jesse Clinton, managing director at Snowden Lane Partners. Clinton points to the declining ESG ratings for Wells Fargo (WFC) - Get Report and Valeant (VRX) prior to major misconduct announcements - even as consensus ratings were increasing - as evidence that sustainability is an indicator that needs to be closely watched. Furthermore, he said demographics are in ESG investing's favor with women and millennials being the largest demographics inheriting wealth and "they care about this a lot." He points out that in corporate America over 80% of companies are now reporting on their ESG initiatives versus only 20% just three year ago. Clinton is playing this trend via the iShares MSCI USA ESG Select ETF (KLD) , which is based on the KLD Select Social Index and is comprised of about 120 companies from the S&P 500 and Russell 1000. He also likes the iShares MSCI KLD 400 Social (DSI) - Get Report , a more diversified group that tracks the MSCI USA ESG ETF.