More people today are aligning their investments with their personal values, using Socially Responsible Investments (SRI) to make a meaningful impact.
SRI investing can include green, ethical, sustainable, or impact investments. SRI may also integrate environmental, social, and governance (ESG) factors into investment decisions. It’s about using wealth to create a more sustainable and equitable world.
The Current State of SRI in Canada
More Canadian investors are choosing SRI for their portfolios and it’s one of the fastest growing segments in the financial services industry. According to RIA Canada’s 2024 Trends Report, responsible investments grew to a new high of almost $4.5 trillion in 2023.
Three key sectors are emerging as top choices for Canadian SRI investors are impact segments: renewable energy, affordable housing, and green technology. These key areas of SRI align with Canada’s Net-Zero Emission Plan for 2050, where our economy either emits no greenhouse gas emissions or offsets its emissions. The goal in reaching this is to keep the world safe and livable for future generations.
As 71% of total assets under management in Canada are responsibly invested, Canadians are showing preferences for Socially Responsible products, including GICs, Mutual Funds, or ETFs to align their portfolios with their values!
Debunking the Myth of SRI Returns
A common misconception about SRI is that they underperform compared to traditional options. However, there is growing evidence that ESG-aligned investments tend to perform in line with—or even better than!—their conventional counterparts over the long term (NEI Investments).
This performance makes sense: companies leading in ESG practices are better positioned to manage risks, adapt to changing regulations, and address global challenges, notes NEI Investments. And, as regulatory bodies increase their ESG requirements and more and more ESG scoring tools become readily available, responsible investing is both accessible and cost-effective for investors!
How Kindred Aligns Your Investments with Personal and Faith-Based Values
Community is not limited by the borders of our towns; our community is also our families, friends, the businesses we patronize, and the products we buy.
At Kindred, we encourage members to connect their values and faith with their finances. Through our SRI products, members can align their portfolios with their ethical and spiritual principles while supporting positive change. All of our investment products have socially responsible options.
In 2001, Kindred (then Mennonite Savings and Credit Union) partnered with Mennonite Mutual Aid and Mennonite Foundation of Canada to launch Meritas Financial Inc., offering socially responsible investments (SRIs) aligned with commitments to peace and social justice. This initiative established Kindred as a leader in values-driven investing. After merging with Qtrade Financial Group in 2010, Meritas expanded its reach across Canada. Since 2017, following another merger Kindred partnered with Aviso Wealth to continue to provide access to SRI options through NEI Investments mutual funds, an industry leader in socially responsible investing. These mutual funds, available through Aviso Wealth at Kindred, complement Kindred’s broader product offerings, which include GICs, Market-Linked GICs, and investment shares, enabling members to align their portfolios with their values.
On January 1, 2015, Kindred introduced screening criteria for all business loans, mortgage applications, and credit reviews. This process uses social and environmental criteria to identify if an investment can be deemed socially responsible. Our screening process excludes companies engaged in harmful practices like gambling or military weapons (negative screens) and prioritizes those supporting human rights, environmental sustainability, and animal welfare (positive screens). These screens ensure that your money is invested in companies that fit your values.
Building on this commitment, in 2016, Kindred became the first financial institution in Canada to have all their GICs validated as SRI! This designation reflects our use of a rigorous negative screening process to exclude industries such as pornography, weapons, nuclear power, marijuana, and tobacco. Some products, like Canada’s first Affordable Housing GIC and Community Inspiration GICs, go a step further by meeting the higher standard of impact investing, directly targeting areas that provide measurable, positive change in communities. These options, along with our full suite of SRI GICs, are thoughtfully designed to align with our members’ values.
Conclusion
At Kindred, we believe your investments—be it time or money—can make a meaningful difference. We want to support and empower our members to make financial decisions that have a positive impact on the world as well as their finances.
As an SRI leader, we have a vested interest in continually enhancing our understanding of our members’ and the market’s awareness and expectations of SRI. So, if you’re ready to align your investments with your values, speak with a member of Kindred’s Wealth and Investment Team today. We can help you Make Peace with Your Money®.
References:
“Five myths about responsible investing.” NEI Investments. Responsible Investing. NEI, 26 September 2022.
“Net-zero emissions by 2050.” A Healthy Environment and a Healthy Economy: Canada’s Climate Plan for a Sustainable Future. Government of Canada, 9 March 2024.
Responsible Investment Association (RIA). 2024 Canadian Responsible Investment Trends Report. Responsible Investment Association, 2024.
Mutual funds and other securities are offered through Aviso Wealth, a division of Aviso Financial Inc. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Unless otherwise stated, mutual funds, other securities and cash balances are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer that insures deposits in credit unions. Mutual funds and other securities are not guaranteed, their values change frequently and past performance may not be repeated. NEI Investments is a registered trademark of Northwest & Ethical Investments L.P. (“NEI LP”). Northwest & Ethical Investments Inc. is the general partner of NEI LP and a wholly-owned subsidiary of Aviso Wealth Inc. (“Aviso”). Aviso is the sole limited partner of the NEI LP. Aviso is a wholly-owned subsidiary of Aviso Wealth LP, which in turn is owned 50% by Desjardins Financial Holding Inc. and 50% by a limited partnership owned by the five Provincial Credit Union Centrals and the CUMIS Group Limited.