Most clients unaware of responsible investing

Your clients probably haven’t heard about responsible investing (RI), but if they do, about two-thirds of them will act on that knowledge.

RI is any investment strategy that offers both financial return and the opportunity to have a positive impact on communities and the environment.

Read: Domestic RI portfolios: Are they viable?

According to a Desjardins Group survey, a significant majority of Canadians use recycling bins (94%), reusable bags (84%) and composting bins (56%). They prioritize buying locally (83%) and make an effort to reduce their carbon footprint (62%).

Yet, 72% of Canadians have never heard of RI, and only 14% have RI products in their portfolios. But a full 66% are willing to adopt the strategy once they learn the details.

Read: Millennials want advisors who know about responsible investing

“Independent analyses demonstrate that RI products offer comparable returns to more traditional products,” says Rosalie Vendette, a senior advisor in responsible investment at Desjardins Wealth Management, in a release. “And the survey shows that 84% of Canadians think they match up as well, which is good news.”

A report published by the Responsible Investment Association reveals that RI grew 68% in Canada between 2011 and 2013, passing $1 trillion in assets under management and making up 31% of the Canadian investment industry.

Read: Experts dish on ESG investing trends, challenges

According to the report, the dominant RI strategy is shareholder engagement, in which shareholders influence companies to improve corporate behaviour. In 2013, the top-three engagement issues were executive compensation, human rights and greenhouse gas emissions.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.