Committed to Sustainable Investing? Three Questions to Ask Your Adviser
Don’t be shy about asking your adviser tough questions. You don’t want to find out after the fact that your portfolio isn’t as responsible as you thought it was.


As sustainable, responsible and impact investing (SRI) continues to gain popularity, more investors have questions and are curious to see if it's right for them.
According to US SIF, the Sustainable Investment Forum, about $8.4 trillion is invested using sustainable investing strategies in the U.S. — that’s equivalent to one out of every eight professionally managed dollars.
Despite some of the negative politics leveled at responsible investing, using ESG (environmental, social and governance) metrics to construct a portfolio is simply a good practice. As a fiduciary, it’s important for me to know as much about a potential investment as possible, and ESG metrics are just as important as traditional, fundamental measurements.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
It's critical to keep in mind there is a difference between ESG and sustainable investing. ESG is simply the metrics — it’s the data that helps your adviser make a decision about your investments. Sustainable investing is the final portfolio. Some investment managers will try to create a portfolio by layering ESG risk metrics over a traditional index such as the S&P 500. While this may have a better outcome than the original portfolio, it still usually includes fossil fuel companies and other non-sustainable companies.
A truly sustainable investment portfolio is built with intention, asking the question, “What kinds of companies are going to make the world a more sustainable and resilient place?” It’s a new way of thinking for a new economy.
I like to describe the difference like this: An ESG index that reduces its exposure to ExxonMobil is “less bad.” A portfolio that eliminates the company is better. But a portfolio that replaces it with First Solar is sustainable.
With all of that in mind, here are three key questions that you should ask your financial adviser about responsible investing:
1. How much experience do you have with sustainable investing?
The practice has been around for decades, but only a select few advisers have specialized in it. Brokerage houses of all sizes have added ESG portfolios to their investment options, but not all of their advisers have taken the opportunity to educate themselves on the ins and outs of SRI. Look for advisers with the CSRIC designation, which means they are a Chartered SRI counselor and completed a course on the topic.
2. How will you avoid greenwashing and create an intentional sustainable portfolio?
All too often, the ESG portfolios that brokerages put together include greenwashed ESG index funds, or ESG funds that are not sustainable. As described above, these portfolios are simply less bad versions of traditional stock indexes. I’ve found that most individual investors are interested in a solutions-based portfolio — one that truly reflects their personal values. An impersonal ESG index fund likely won’t meet your priorities. It’s just as important to understand what companies the adviser is removing from and adding to your portfolio.
3. Do you use outside managers?
A great way to eliminate the oftentimes proprietary investment recommendations proposed is for an adviser to use an outside expert SRI portfolio manager. These are often termed SMAs, or separately managed accounts. Your adviser basically contracts with the outside expert portfolio manager to oversee the investments for you while the adviser continues to manage the relationship. It’s the best of both worlds!
When you choose to invest with your values, it may make for an uncomfortable conversation with your current or prospective adviser. But it’s important that you not be shy about asking the tough questions — you don’t want to get a year or two into the relationship only to find out that your investments include ExxonMobil and DuPont (which is entirely possible with some “less bad” ESG index portfolios).
These three questions are just a guide to get you started becoming a more responsible investor. There are many more questions to ask depending on your personal situation, values and goals. Make a list before your meeting, and don’t be afraid to say “next” and move on to another expert if your adviser doesn’t understand how to craft a sustainable portfolio that aligns with your values.
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Peter Krull is the Partner and Director of Sustainable Investments at Earth Equity Advisors, a Prime Capital Financial Company, and has been specializing in sustainable, responsible and impact (SRI) investing for nearly 20 years. He earned the Chartered SRI Counselor® from the College for Financial Planning. In June 2024, Peter was recognized by InvestmentNews as the ESG/Responsible Investing Advisor of the Year. (Award was for the 2023 year, and no compensation was given.) Peter is a longtime advocate for sustainable, fossil-fuel-free investing and works hard to educate his clients and the public on greenwashing in the SRI/ESG industry. He is the host of "Dollars & Change," a podcast about sustainable and responsible investing, and he believes strongly in the power of positive, solutions-based sustainable investing focused on the economy of tomorrow.
-
Ask the Editor — Tax Questions on Inherited IRAs
Ask the Editor In this week's Ask the Editor Q&A, we answer tax questions from readers on the rules on inheriting IRAs.
-
I Asked Experts When It's Worth Splurging on Beauty and Skincare — and When You Can Save
Smart Shopping Experts agree that while you don't have to spend three figures on your products, some higher-priced items have value.
-
Retiring Early? This Strategy Cuts Your Income Tax to Zero
When retiring early, married couples can use this little-known (and legitimate) strategy to take a six-figure income every year — tax-free.
-
Ditch the Golf Shoes: Your Retirement Needs a Side Gig
A side gig in retirement can help combat boredom, loneliness and the threat of inflation eroding your savings. And the earlier you start planning, the better.
-
Roth IRA Conversions in the Summer? Why Now May Be the Sweet Spot
Converting now would enable you to spread a possible tax hit over more than one payment while reducing future taxes.
-
A Financial Expert's Three Steps to Becoming Debt-Free (Even in This Economy)
If debt has you spiraling, now is the time to take a few common-sense steps to help knock it down and get it under control.
-
I'm an Insurance Expert: This Is How Your Insurance Protects You While You're on Vacation
Here are three key things to consider about your insurance (auto, property and health) when traveling within the U.S., including coverage for rental cars, personal belongings and medical emergencies.
-
Investing Professionals Agree: Discipline Beats Drama Right Now
Big portfolio adjustments can do more harm than good. Financial experts suggest making thoughtful, strategic moves that fit your long-term goals.
-
'Doing Something' Because of Volatility Can Hurt You: Portfolio Manager Recommends Doing This Instead
Yes, it's hard, but if you tune out the siren song of high-flying sectors, resist acting on impulse and focus on your goals, you and your portfolio could be much better off.
-
Social Security's First Beneficiary Lived to Be 100: Will You?
Ida May Fuller, Social Security's first beneficiary, retired in 1939 and died in 1975. Today, we should all be planning for a retirement that's as long as Ida's.