While many of us are thinking seriously about climate change, increasing energy efficiency and independence these days, there's a whole other avenue that more and more folks are starting to take seriously: making your investments cleaner and greener.

As one friend mentioned to me recently, it makes little sense to try to be more in tune with the environment on one hand, and investing in the most polluting companies on the planet with the other. The good news is, you don't have to.

Indeed, the universe of more environmentally responsible and green investments has been exploding over that last 10 years with dozens of new green mutual funds and exchange traded funds (ETFs). In fact, there's now a slew of relatively green investment options that cover the gamut of asset classes. From large company growth, to aggressive growth, to bonds; from investments in solar energy, energy efficiency, and waste reduction, there's an investment for even the most lax of environmentalists.

Perhaps the best news is that many of these investments have done as well, if not better than their mutual fund peers that don't even consider environmental issues. A recent analysis performed by the consulting firm Mercer of 36 studies demonstrated a strong link between financial performance and environment and social governance factors. The upshot is this: taking the environment in to consideration in your investing shouldn't markedly affect performance.  

There are several ways to get involved in green investments. The easiest, and perhaps safest way is to invest in a diversified "socially responsible" mutual fund that looks at quality companies that think progressively about the environment but also includes other issues – i.e. social governance, fair hiring, no tobacco – when making their investment decision.

Some of these funds – Calvert Large Cap Growth (CLGAX, +49%), Progressive 21 (PORTX, +48%), Parnassus (PARNX, +60%), to name but a few – have long term track records, and can actually fill a central role in the equity or growth part of a portfolio. A number of pure "green funds" are also available.

The Social Investment Forum (www.socialinvest.org) and Socialfunds.com are two sites that can provide a wealth of information for the do-it-yourself investor. Several of these funds are made available in various retirement plans as well. For someone looking for a financial professional who can provide expertise in this area, while there aren't many around, just head back over to the Social Investment Forum's website and its professional directory. Help will be on the way.

Keep in mind that the internal expenses of green mutual funds tend to be higher than others, but the investor gets some real benefit for that: not only do these funds go the extra mile in evaluating the environmental and social performance of companies, they actually pressure corporate boards using shareholder activism to steer companies to take the higher road. In essence, your investments in these funds are acting as environmental advocates!

So, if you're interested in greening up your life, greening up your investments is something you can do right away that can make a difference. Part 2 will discuss a few of the many other green investment choices that are available. Join us.

Ron Stein is a certified financial planner and  the founder of Good Harvest Financial Group located in Huntington.