Texas AG Greg Abbot: he may be wrong, but he may be right.In a rush to push through well-intentioned and headline-grabbing divestment legislation targeting the multinationals that aid the genocidal regime in Sudan, politicians may be doing more damage to the movement than good.

Evidence of this backlash surfaced last week. Texas Attorney General Greg Abbott issued a statement that requiring divestment on any grounds would be contrary to the Texas constitution. As his reasoning goes, pension funds are to be run “for the sole benefit of pensioners”, so any bar set on moral grounds amounts to a diversion of funds.

Pending legislation is currently being debated in the Texas Legislature as well as at several county and municipal levels. Thankfully, the Attorney General neither writes laws, nor issues legal rulings. In my opinion, the move was meant to signal to lawmakers that he will be ready and willing to take up the cause against the legislation if, and when, it becomes law. He disputes the idea that the Legislature has the right to direct the pension trustees. Legislators respectfully disagree.

As a resident of Austin, I have observed the Attorney General, a Republican, and generally thought highly of his law enforcement and his avoidance of partisan hackery. Most Texans admire him for overcoming his disabilities (the AG is wheelchair-bound). On this issue, however, he is deeply mistaken. Setting guidelines about the fitness of a company for investment is what trustees and their managers do. That is what it is all about. Many pension funds worldwide, for example, require that companies have a listing on a major exchange. Pink sheet companies are forbidden. Others have guidelines that only “investment grade” bonds can be owned. Mostly, I find it highly relevant to pensioners to assume that companies who aid and abet genocide might not have the best interest of pensioners on their minds. Companies that make the right moral choices generally turn out to be the best stewards of investment money. They are not mutually exclusive propositions.

But, wait. After reading the statement and dismissing it as the ramblings of an ignorant bureaucrat, I actually reconsidered my opinion. Nationwide, divestment legislation is a mish-mash, differing widely in scope, flexibility, and targets. Most enacted or pending legislation is targeting the regimes in Sudan, Iran, and North Korea. However, other smaller divestment movements exist around animal rights, sweatshop labor, non-union labor, alchohol, gaming, abortion (on both sides), and others. Taken separately, I can begin to understand the fear facing pension managers. Pensioners do not need trustees that have to look over the shoulders of their managers on every transaction, and managers should not need to check with their attorney every time they want to make a trade.

All divestment movements would be well-served by simplifying and unifying. The legislation should be about forcing pension trustees to hear the voice of the people. Making judgements on moral grounds should not only be accepted, but expected. We should abandon the efforts to push through every single divestment agenda. Instead , we should focus on protecting the trustees’ authority to set moral guidelines and defeating ideas such as those coming from the AG’s office.

The California Public Employee Retirement System (Calpers) has operated with a social agenda for a few decades, and remains a leader in both performance and respect nationwide. The blueprint is there.

Mark Brandon is the owner of First Sustainable, a registered investment advisory catering to socially responsible investors.

Don't Be The SuckerAmid all of the truly groundbreaking new technologies, innovative companies, and fresh-minded thinking surrounding renewable energy, organic agriculture, distributed generation, and other green memes lurk ugly, but familiar beasts — the penny stock operator and the private placement promoters. With a penchant for press releases and the skillful use of all the appropriate buzz words, these charlatans are not only making off with some ill-gotten booty from unsophisticated investors, they are diverting much needed investment dollars that could otherwise be going to the more deserving ventures.

It is amazing that people fall for these things a mere six years after the meltdown of the "new economy" internet debacle. However, if you know how to look, they are not that hard to spot. Here are some tips to protect yourself:

1) No listing… no dice. Qualifying for a listing on the NASDAQ is not that hard for a company, and qualifying on the AMEX is even easier. Profits are not a requirement and neither is revenue, for that matter. This is a good rule, by the way. Some industries, especially in technology and medicine, require many years before a product is ready for market. It only takes about $40,000 in listing fees, $4 million in assets, and about 400 investors. If a company has what it takes to survive in the public markets, such as a solid management team, an interesting product or technology, and a reasonable business plan, it is also not that hard to find a reputable underwriter to help you meet these requirements. Usually, a pink sheet stock is on the pink sheets because the reputable underwriters took a look at the prospects and said "no way". This alone should clue you in to the highly speculative nature of the enterprise.

2) Is it news, or fluff? If you look at the company's web site, or widespread personal finance sites like Google Finance, you can usually spot the "Company News" link. In many cases, what looks like news is only a press release. Sometimes, it is more cleverly disguised, but it still amounts to fluff. If the source is Business Wire, PR Newswire, CSR Wire (which is for the SRI crowd), or something similar, then this "news" was written by someone with an agenda. It's not the wire's fault. That is what they do. Even if the source seems more real, see if the reporter is critical in the analysis. Many local papers are anxious to write about local "success stories".

3) …and you are? If the first two reasons have not scared you off, take a look at the management team. First off, there should be more than one, and they should all have different last names. You would think that investors would not be so gullible, but I was pitched just last week by someone hoping to fund a "blank check company" with one CEO and one director (the same person). What is likely to happen is that the "officers" will form a compensation committee (of one) and decide on a grossly exhorbitant salary for the management team. Second, it is reasonable to expect that company leaders have proven themselves to be good stewards of public money.

4) The Woody Allen Rule. Seriously, unless you are yourself a multi-bazillionaire, ask yourself why people would want you to join their country club. Like Woody Allen, you should resolve that any club that would have you as a member is not a club you want to belong to. The very best IPO's and private placements are reserved for Wall Street's best clients. This unfortunate fact is conspiratorial and wrong, but a fact nonetheless. It is a good rule to follow for ANY investment, whether real estate, "fine art" Dali prints, collectibles, or stocks and other securities.

5) … and you are (part 2)? A lot of companies that failed to ignite investor interest in other fields, are just changing their names and starting anew. Take, for example, Western Wind Energy, a company that was, until a few months ago, a mining firm. Another example is Newgen Technologies, also a former mining company, now on its third name. Neither company ever produced a nickel's worth of revenue.

Some of these scams have legitimate sounding names and even more legitimate business plans, but watch your wallet. As always, be diversified, keep investment costs low, maximize your company's 401(k), and be systematic in your saving. You will do just fine.

Mark Brandon is the owner of First Sustainable, a Registered Investment Advisory catering to socially responsible investors. His column appears in Green Options on Mondays.

Green Giants: Yvon Chouinard of Patagonia; recycling computer parts at H-PThe current issue of Fortune is a treasure trove of stories of companies that got the green religion. Some did it from the standpoint of a moral imperative. Others did it for the other type of green — money. The cover issue is about the so-called "coolest company" on earth, Patagonia, maker of outdoor apparel and gear. Alas, it is not a public company.

However, other stories are more complex. Take, for example, the case of Dupont (NYSE:DD). After decades of resisting pressure about their ozone-depleting CFC's, the company learned that CFC-substitutes not only soothed environmentalists, but also increased profits. This caused the CEO to direct his team to find similar innovations. The result is a reduction in greenhouse gases on the order of 76 percent. Of course, as with many of the most astounding cases of reduction, it logically follows that they were heavy polluters to begin with. Other features in the article include Goldman Sachs (NYSE: GS) and their project financing innovations, Swiss Re (OTC:SWCEY) and its weather-derivative innovations, and Hewlett Packard (NYSE:HPQ) and its industry-leading e-waste initiatives.

Socially Responsible Investors often fall into three categories. Some object to owning companies involved in dirty businesses. For these, Dupont will never be acceptable. They do, after all, still make Teflon which has been shown to have ill health effects. Another category accept that, as long as the company leads its field, and makes genuine efforts (without greenwashing), it is worth owning. Waste Management (NYSE: WMI), for example, is clearly in a dirty business, but among waste companies, it has a pretty respectable agenda for accomplishing its economic reason for being without trashing the planet. The third category, and the one I find most exciting, is the customer who recognizes that there is money to be made in being more efficient.

Which one are you?

Mark Brandon is the owner of First Sustainable, a Registered Investment Advisory, catering to socially responsible investors. His column appears in Green Options on Mondays.

Image source: CNNMoney.com

Skeptics abound about the whole concept of socially responsible investing. Some of them have merit. Others are just plain silly.

Statement: SRI does not perform as well as traditional investing
Status: Mostly False
Explanation: As more people become of aware of investing responsibly, a lot of naysayers point out that social portfolios and funds have underperformed market indexes over the last few years. This much is mostly true, but it is not that simple. Following the tech bust and subsequent recession, the market enjoyed a cyclical upturn in 2003, which continues to the present day.

In this cycle, as in most early-stage cycles, the stellar performers have been commodities-based companies, extractive companies, heavy industrial companies, and of course, oil companies. Many socially screened portfolios have not participated with these companies because they tend to rely on socially troubling practices. Commodity players (some, not all) are in developing countries paying exploitative wages. Heavy industry pollutes. Oil companies are a root cause of global warming emissions. But, since overall market indexes incorporate these companies, SRI indexes have trailed.

However, with an over-weighting toward technology and health care stocks, SRI portfolios outperformed for seven years prior to the last upturn. Most of the run-up in those cyclical stocks occurred in 2003. So, any study of the matter that does not take multiple cycles into account is just plain incomplete. The best scholarship on the topic, represented by the Social Investment Forum’s Moskowitz Prize, shows that there is no real difference between screened and non-screened performance over the last 25 years. The verdict is that SRI neither underperforms, nor overperforms traditional investing on a financial return basis.

Statement: SRI is more risky.
Status: False
Explanation: Adherents to the Dow Theory claim that by narrowing your universe of stocks through social screening, you increase your risk by decreasing diversification. The problem with that notion is that, by definition, managing a portfolio requires narrowing your universe of stocks. If that is too much work or too expensive, just get an index fund and be done with it.

Statement: Companies do not pay attention to social investors.
Status: Mostly False
Explanation: Skeptics point to alcohol, tobacco, and gambling companies, long the target of social divestment strategies, and show that the social divestment movement has not really made them change their ways. This is probably true. Divestment probably does not work when a socially repugnant enterprise is the core business. In these cases, activists can only hope that they behave more responsibly, such as has happened with cigarette settlements, better labeling, etc.

Social investment activism has been very effective with companies that have repugnant practices in the everyday pursuit of their not-especially-repugnant businesses. For example, Nike (NYSE:NKE) was once shamed as a pariah of sweat shop labor. Today, that company is one of the most progressive companies on the issue. Social investors recently persuaded large publicly traded financial companies such as Goldman Sachs (NYSE:GS) and Lehman Brothers (NYSE:LEH) to pledge to clean up their project financing guidelines. I could go on and on. If the company's core business is not socially IRRESPONSIBLE in and of itself, SRI can have a huge effect.

Statement: National divestment campaigns do not work
Status: Jury is still out
Explanation: Social investors like to take credit for forcing companies to divest from Apartheid-era South Africa. The economic isolation was one reason that the white leadership eventually caved. I, personally, think that SRI contributed to Apartheid’s downfall, but realize that there were several other issues that contributed as well. Alas, this is a subject for another post, or even another Green Options blogger.

However, anecdotally at least, one can look at occasions of forced divestment through government regulation to see how this works. Companies have been forced to divest from countries with oppressive political regimes for decades. Forced divestment from Cuba, Iraq, Iran, North Korea, Libya, the former USSR, and its allies frankly has a mixed record. Economic isolation definitely caused some communist regimes to crumble. In other cases (Cuba, Libya, Iran), sanctions have not had much effect on destabilizing regimes. And, in others (Iraq, North Korea), it could be argued that sanctions have caused suffering only among the population while actually strengthening the targeted regimes. Having an enemy to rally against while at the same time exploiting black markets created by sanctions helped Saddam hold on to power, and is probably doing the same for Kim Jong Il.

The current campaign to divest from Sudan is a current hot-button issue. In my opinion, this is a case where national divestment could work. Oil revenues are giving the genocidal government its power. Foreign oil companies make those revenues possible. Make no mistake. The ethnic cleansing going on Darfur is all about claiming oil-rich land. If it were just about claiming political power (as in Cuba, or North Korea), I would be more skeptical that financial investors could change the minds of maniacs.

Mark Brandon is the founder of First Sustainable, a Registered Investment Advisory catering to socially responsible investors. His weekly column appears in Green Options on Mondays.

Standard & Poor's, the granddaddy of indexing companies, has launched three new "thematic indices" for the clean and green crowd. Although not currently tradable, do not be surprised if index mutual funds or ETF's are soon created to mirror these baskets. They are:

S&P Global Clean Energy Index: Representing 30 companies, 10 countries, and a total market capitalization of $117 Billion, this index is a composite of clean energy producers, equipment makers, and technology companies. The top 10 holdings are:

1. MEMC Electronic Materials (NYSE:WFR)

2. Vestas Wind Systems A/S

3. Renewable Energy Corporation AS

4. Suntech Power Holdings (NYSE:STP)

5. Solarworld AG

6. Germany Q-Cells

7. Endesa-Chile

8. Copel -PNB (Companhia Paranaense de Energia SA)

9. ACCIONA SA

10. Sunpower Corp.

S&P Global Infrastructure Index: Representing 75 companies, 22 countries, and an aggregate market cap just shy of $1 Trillion dollars, this index focuses on utilities, transportation and energy. It's top 10 components are:

1. Abertis Infraestructuras

2. E.On AG

3. Autostrade SPA

4. TransCanada Corporation

5. Macquarie Infrastructure Group

6. Williams Cos

7. Suez SA

8. Kinder Morgan

9. Enbridge Inc

10. El Paso Corp.

S&P Global Water Index: Representing 49 companies, 14 countries, and $227 billion in aggregate market cap, this index focuses on water utilities, water equipment makers, and water infrastructure. It's top 10 components are:

1. Veolia Environnement

2. Suez SA

3. Mitsubishi Heavy

4. Kubota Corp.

5. United Utilities

6. Danaher Corp.

7. ITT Corporation

8. Nalco Holdings

9. Pentair Inc.

10. Severn Trent

Although not perfect, these indices do a respectable job of separating out companies whose clean tech activities are only a subsidiary of a larger company. For example, even though Shell Solar and BP Solar are giant players in the solar space, it's impossible to buy their stock and not be entangled primarily with their non-renewable businesses.

The way to take advantage of these indexes is to find a broker or adviser that can handle what is called a Separately Managed Account (SMA). These accounts allow you to purchase underlying components of indices to more or less mirror its performance. Ideally, SMA's require $250,000 to run efficiently without getting killed by transaction costs. With less than that, stick to the existing clean tech ETF's, like the Powershares Wilder Hill index.

Mark Brandon is the owner of First Sustainable, a registered investment advisory catering to socially responsible investors.

Photo: AFP/Jim WatsonState legislatures all across the country, including my home state of Texas, are considering bills that would force state-sponsored investment funds to divest from companies profiting from business with the genocidal regime in Darfur.

If successful, pension funds representing teachers, police, firefighters, and other government employees would have to dump billions of dollars in equity in the offending companies. Presumably, the tidal wave of supply in unwanted stock will force the companies to divest from Sudan, or at best, force the companies to in turn force the regime to change its ways.

On the face of it, the decision to divest seems to be a clear cut moral choice, but in practice, conflicts of interest coupled with questions about whether divestment works not only stalls the pending legislation, but is also overturning existing legislation.

On the conflict question, opposing forces claim that a law forcing divestment conflicts with existing laws requiring fund managers to act in the best interest of the shareholders. If the companies in question generate better than average returns, the thinking goes, then fund managers have neglected their fiduciary duty to seek out the best returns. The fund managers, who are opposed to the law, point out that the companies, most of whom are from the oil and oil services sector, have not only outperformed the rest of their portfolio, but also the benchmark indexes. This much is true. Socially responsible investors must always concede better returns when heavy smokestack industries are in favor.

The last few years have seen superior returns from oil companies. However, when those companies are out of favor, SRI portfolios perform better. SRI portfolios are more heavily weighted toward technology and healthcare stocks, so for the seven years prior to the recent run-up in oil prices, SRI-screened portfolios performed better.

Divestment proponents lost a key battle on the conflict front. On February 23, a federal judge overturned Illinois' law, which was generally regarded as the most progressive, but also the most restrictive. The judge said such a law violates the federal government's authority to set foreign policy. Less restrictive laws have passed judicial muster, though.

Whether divestment works, or not, is also in question. Proponents point to the institutional investor pressure placed on the Apartheid-era regime in South Africa as a key reason for that regime's fall. Opponents claim that the reasons behind Apartheid's fall are more complex, and also say that excess supply caused by dumping will just be scooped up at bargain prices by investors with less scruples.

I can neither give concrete evidence that divestment does or does not work. However, if you own shares in the offending companies, whether through your pension or directly, then you personally are profiting from genocide. So, to me, it does not matter if it works. I would want no part of it. Companies such as Oil and Natural Gas Co. of India, China Natural Petroleum Corp., and Schlumberger (NYSE:SLB) should pay the price of propping up murderers.

Mark Brandon is the owner of First Sustainable, a socially responsible investment advisory. His weekly column on SRI appears in Green Options on Mondays.

Market meltdowns, like the one we saw last week, and the one that may be forthcoming this week (as of this morning, the Asian markets took another nosedive), are no reason to panic.

In fact, unless you are on the cusp of retirement (or currently retired), market corrections are mostly positive news. Corporate profits are at multi-year highs. U.S. corporations have as more cash on hand than at any time in history. Because of the first two reasons, dividends and buybacks are also on the rise. The correction allows you to buy these assets and cash flows for that much less.

Whether you invest responsibly or not, most individuals need to keep these four principles in mind:

• Be diversified. Unless you have a few million and do not need to work, you should not be concentrated in any one company or asset class. Even if you are getting generous options grants from your employer, you should periodically diversify to protect your downside. Proper allocation is where a good financial adviser can really earn his or her pay, because arriving at such an allocation requires taking into account your life stage, your goals, your current assets, your income, and a lot of other factors.
• Be low cost. The average actively managed mutual fund charges an astounding 1.57 percent of assets each year. If you figure that stock returns historically average 8 - 12 percent, that is a lot of money for no risk. Still, that figure would be fine if they consistently outperformed the market benchmarks. Alas, they do not. While about 40 percent of actively managed funds beat their benchmark in any one year, less than 15 percent beat the benchmarks over 5 years. If you consider that index funds charge 60 to 90 percent less than 1.57 percent, you might as well be content with market returns.
• Maximize your company's 401k plan. Nowhere else can you get a tax deduction, tax deferral, and free money in the form of a company match. Think about it. A company match means that you get a 100 percent return automatically. No investment vehicle in the world can offer that kind of return without risk. Even if your company does not have a match, the tax deduction can enhance your dollars by 15 to 35 percent. Still pretty good.
• Be systematic. Whether you resolve to invest once a week, once a month, once a quarter, or whatever, be disciplined about saving a set amount. This is yet another reason to utilize your 401k plan, because money will be taken out of your paycheck every time you get paid, and you will not even miss it. Systematic savings plans also allow you to take advantage of lower prices when the market corrects.

If you follow the above principles, then most of you will do just fine. Concentrate on making money through your employment or entrepreneurial endeavors. The more one obsesses over making money in the market, the more likely they are to start market timing, and believe me, almost everyone who tries to beat the market with timing fails. Even the professionals.

You might be wondering which, if any, vehicle accomplishes this task. My favorite mutual fund is the Vanguard FTSE Social Index Fund (VFTSX). Based on the FTSE4Good Index Series, it focuses on environmental sustainability, human rights, and corporate governance. The management fee, at 25 basis points (versus the aforementioned 157 basis points for actively managed brethren), is the lowest among all SRI funds. Versus non-screened indexes such as Vanguard's S&P 500 Index Fund, this fund is a little more heavily weighted towards technology and healthcare companies, but not so much that it would wreck a sound asset allocation.

Can the Pariah be Rehabbed?Few companies raise the ire of the SRI crowd — or any other crowd, for that matter — as much as Wal-Mart (NYSE:WMT). Most readers of Green Options do not need for me to recap all of the allegations of exploitative wages, sweatshop abuse, sprawl-mongering, Main Street destruction, and overall corporate rapaciousness. Yet, in the last year, the company has unveiled the following initiatives:

• Wal-Mart Sustainable Packaging Value Network. The company is leading the largest effort in the retail industry to encourage sustainable packaging not only at its own stores, but throughout its value chain.
• ASDA, Wal-Mart's British subsidiary and the 2nd largest grocer in that country, has pledged to reduce its packaging by 25 percent by the end of 2008.
• The company has pledged to sell 100 million compact fluorescent lights, a goal which, if achieved, would save American consumers $3 billion in energy costs, and prevent the emissions equivalent to a fleet of 700,000 vehicles.
• The company has recently become the 2nd largest private purchaser of renewable power, second only to Whole Foods Market.
• The company is testing several concept stores, designed to use zero net energy. Succeeding would not only reduce Wal-Mart's giant impact, but it would light the way for other big box retailers.
• Wal-Mart has long had a favorable reputation among SRI investors who make diversity their social criteria. The company is among the largest employers of black and hispanic managers in the country, far exceeding some of its more unionized critics.

I am sure I missed some other initiatives, since CEO Lee Scott has been on a whirlwind tour promoting them all. If Wal-Mart even partially succeeds in accomplishing what it has announced, the net impact will be greater than the comparatively tiny initiatives of Target, Costco, Kohl's, Sears, and KMart combined. If British Petroleum (NYSE:BP), an oil company for Pete's sake, can be sainted in SRI circles, why should Wal-Mart continue to get such a bad rap?

In addition to BP, large companies have shown before that they can change their stripes. Nike (NYSE:NKE) used to be known as a sweatshop pariah. Now, they lead the charge against sweatshop abuses. Dell, Inc. (NASDAQ:DELL) faced e-waste picketers not more than four years ago. Now, they have the most comprehensive e-waste policy of any computer manufacturer. Denny's (NASDAQ:DENN) was once handed the most severe punitive judgement ever for discrimination. Now, they are getting awards.

What do you think? Is this Greenwashing, or has Wal-Mart gotten the religion?

GE Shareholders: Stop Lobbying for Greenhouse Gas RegulationOne of the cornerstones of activist investors is lobbying for better carbon disclosure. As the thinking goes, putting it down on paper will make executives think about improving their carbon impact.

Yesterday, General Electric (NYSE:GE) lost a shareholder bid to quash GE's lobbying efforts to better regulate carbon emissions. GE has a large "Ecomagination" business selling all manner of climate friendly products. The problem is that, even though Ecomagination is a $10 billion business and is one of GE's fastest growing divisions, it is a small fraction of GE's overall $160 billion business.

In this case, an activist investor is on the other side of the table, encouraging GE to NOT lobby for such regulations, on the thought that it could harm the rest of GE's portfolio. This does not mean that the proxy proposal will win. It just means that GE can not block it from coming to a vote.

Is this an investor activism backlash?

Mark Brandon is the owner of First Sustainable, a socially responsible investment adivsory, and author of The Sustainable Log blog and newsletter.

Ethanol Affecting Tortilla MakersInvestors who got on the ethanol bandwagon after LAST year's State of the Union address had a wild ride indeed. The frothiest (no pun intended) of them all was Pacific Ethanol (NASDAQ:PEIX). The Fresno, CA-based marketer and refiner started 2006 in the 11 range. After Bush's State of the Union, it nearly quadrupled to 42 by May. As of Friday, it closed at 16.47. Investor enthusiasm waned as oil prices waxed. The cycle may start again this year, with not only Bush but also every single presidential candidate LITERALLY buying the farm as they campaign in Iowa.

This column is not about ethanol, however, but instead about following the herd when it comes to clean tech investing. Even though I have mixed feelings about ethanol (a subject for another post), do not get me wrong. Clean Energy is going to be THE defining industry of the next few decades. It will be to the 21st century what the automobile was to the 20th and the railroad to the 19th. The problem is that just about everybody has figured that out by now, giving rise to valuations have no basis in reality.

Some fresh thinking is in order. If you still want to capitalize on a 21st century mega-trend, you will need to start thinking downstream. Instead of investing in the darlings, think about how the trend will affect other companies. For example, Jim Rogers, the famed commodity investor and world traveler, mentioned on CNBC that one of his best oil bets was actually in sugar companies. Why? Sugar cane is the primary feedstock for ethanol in Brazil. Subtrends, too, will provide ample opportunity. High corn prices, abundant wind resources, and other incentives will bring prosperity to rural American unseen since the 1950's. Which companies can benefit from that? Retailers based in the Heartland? Car and Truck Dealers? Real Estate Investment Trusts?

Solar stocks are a bit bumpy now, too. The recent rise in the price of silicon has been well-chronicled. Which companies are positioned to either provide a substitute, or service a workaround? This much, I know. The solar bandwagon is here to stay.

The rising price of corn might provide opportunities for an investor. It has gone from $2 to $4 per bushel since 2004, putting undue stress on several other economic factors. I am afraid that investing in corn commodities, corn agribusiness, and other corn-based businesses may have already experienced the price run-up. However, it won't take much before, for example, soft drink manufacturers switch their formulas back to sugar. In the 1980's, the beverage makers decided to use corn syrup thanks to the high cost of sugar (caused by the type of protectionism that is now affecting corn). Will soft drink makers and confectioners benefit or suffer? How about bakers? The tortilla-based economy just might make a large switch to flour, instead of corn, as Mexicans riot over the skyrocketing price of corn tortillas. Far-fetched? For the first time since Aztec times, the Mexican government is now importing corn because so much of their domestic crop is earmarked for ethanol production.

The Clean Tech megatrend does not mean the laws of supply and demand are going to take a vacation. You still need to think a few moves ahead of everybody else to make a buck.

What do you think? Where are the undiscovered opportunities, the less glamorous by-products of the Clean Tech revolution?

Mark Brandon is the owner of First Sustainable, a socially responsible investment advisory, and the author of the Sustainable Log newsletter and blog. His columns appear Mondays at Green Options.