As the industrialization of China’s economy continues to advance, Beijing is taking steps to clean up a growing pollution problem, opening up a opportunity for investors looking to capitalize on the efforts through a new KraneShares ETF that specifically targets Chinese companies focused on environmental sustainability.

On Friday, KraneShares added the KraneShares MSCI China Environment Index ETF (NYSEArca: KGRN), which has a 0.79% expense ratio.

The new ETF tries to reflect the performance of the MSCI China IMI Environment 25/50 Index, which is comprised of Chinese companies focused on contributing to a more environmentally sustainable economy by making efficient use of scarce natural resources or by mitigating the impact of environmental degradation, according to a prospectus sheet.

The company components found in the underlying index may be categorized under five different themes, including alternative energy, sustainable water, green building, pollution prevention and energy efficiency.

Due to China’s quick industrialization and economic expansion, the emerging country has see pollution levels surge.

“China’s rapid economic development has impacted the environment. Levels of air and water pollution in China are much higher than those recommended by the World Health Organization,” according to KraneShares note.

Consequently, more Chinese cities have taken action to reduce the pollution.

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