As with most of the financial services industry, the need to be cynical with ethical investing is encouraged. The minute we were told that gases from our fridges were hurting the environment our bank accounts began the unleashing of the taxes the like of which we have never seen before. Easy come.

To speak out about green or ethical investments is seen to be inappropriate. 'Why would you not want to protect mother nature' is the general tune, and so those with any wealth, or a car that matches that, will feel the wrath of simplified, but effective marketing that governments have applied.

Whether or not you believe in global warming or climate change is a separate argument, one which you might find very interesting, but this article will not cover that. However, a trip to iceagenow or climateaudit, and a few hours reading, coupled with the fact that no real improvements or investments by global governments in the essential infrastructure have taken place in the last six years, despite the need, will leave you much more balanced than you may currently be thinking.

It is the dishonesty of some organisations in constantly filling our heads with inappropriate data in search of their own profit that has been the cause of increasing cynicism - It is just as easy for some to prove global cooling and the reason for it, as it is for others to prove climate change (interestingly used to be called global warming) and the reason for it.

Either way, there is no doubt whatsoever as a world that we are wasteful with our resources and cannot continue with that in any measure of sustainability so I'll leave the above melting pot aside for another time as I focus on which funds you may consider.

To choose the better funds you might need to consider how they choose what to invest into.

Ethical is a broad term, which, if we look at a thesaurus, means principled, moral, fair or decent. That would be good enough criteria for me to invest into a fund but would be a bit vague for the financial services industry which would struggle with such an educated choice.

A fund manager's role is simply to look at all the best stocks in the market and buy them and make you money. You invest 'x' and achieve a spread across a wide range of stocks and shares that you would not normally be able to. Of course you have no way of knowing if each of the 60-100 stocks you have, all match your criteria of 'ethical' or 'green' so you rely on the trust deed of the investment manager which will detail that.

Funds will positively screen or negatively screen stocks. Positive screening focuses on companies developing alternative resources or technologies which will result in a lesser impact on the environment. They will also screen to look for companies that support appropriate social issues such as fair payments for services or goods in disadvantaged countries or education.

Negative screening looks for companies that are involved in 'things we wouldn't call moral, just or fair' such as armaments, tobacco, pornography, animal testing, avoidance of alcohol for example.

Some of the screening is very strong and focused whilst others are not and you should make it clear to the financial adviser giving you investment advice what your key criteria is. It is not unknown for example, for a fund to screen against pornography but not against armaments.

Your choice of fund however, should look closely at the management style of the manager, their focus and costs, whilst comparing the fund performance - which you will find very interesting.

Aberdeen Ethical world for example is arguably the best global fund; yet its return over the last year is 4th decile in a sector where it is compared against unconstrained investments.(1) Its risk (measured by standard deviation) is 10th decile (worst) and its Sharpe ratio (basically the potential for return and is it worth that risk) is 7th decile.

If this is the best global fund, ethical investors need to be aware how much bang they are really getting for their buck.

For a fact sheet of the best performing Ethical funds call Peter on 0845 230 9876, e-mail info@wwfp.net Source 1 Lipper