Kindred is committed to Socially Responsible Investing (SRI): we believe there is a connection between investing, be it with time or money, and making a difference in the world. We want to support and empower our members to make financial decisions that have a positive impact on the world. 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. Further, we wanted to understand member and market values regarding charitable giving and volunteerism. With these things in mind, Kindred commissioned our research partner, PMG Intelligence, to conduct our first SRI study in October 2018.
Kindred members place high importance on sharing their time and money with the community in order to make the world a better place, so it makes sense that these values translate to a desire to invest responsibly.
What We Learned:
- Awareness and Knowledge of SRI
- Expectations Regarding SRI Offerings
- Importance of Negative Screens
- Importance of Positive Screens
- Connection Between Charitable Giving and SRI
- Conclusion
1. Awareness and Knowledge of SRI
Less than 1-in-5 claim to be ‘knowledgeable’ or ‘very knowledgeable’ about socially responsible investments. Respondents who have a formal written financial plan are more likely to be more knowledgeable about SRIs, to hold SRIs, and to use an advisor to help them plan charitable giving.
The gap between awareness and knowledge of SRIs means Kindred has a significant opportunity to educate members and the marketplace about the value of SRIs. These results also reinforce Kindred’s belief that having a formal, written financial plan contributes to peace of mind for members as they seek to connect values and faith with finances.
2. Expectations Regarding SRI Offerings
Two-in-five members feel it is ‘very important’ that their financial organization offers socially responsible investments. Those who are more knowledgeable regarding SRI are more likely to feel it is ‘very important’ that their financial organization provides SRI options.
As a credit union, we are committed to listening and acting on member needs. These results reinforce our longstanding commitment to offer our members meaningful investment options, with a focus on SRIs.
3. Importance of Negative Screens
Screening is a filtering process based on social and environmental criteria that is used to identify if an investment can be deemed socially responsible.
Negative screens strive to limit investing in companies that engage in practices such as gambling, military weapons, nuclear power, and pornography.
More than half of members feel it is ‘very important’ to have negative screens in place for pornography/adult entertainment, military and weapons, gambling, and tobacco. More than half of the market indicated that the pornography/adult entertainment screen is ‘very important’.
Of the negative screens presented, members indicated that the most important is the military and weapons screen, while the market chose the pornography and adult entertainment industry as the most important screen.
The results from our members reflect our shared values as a cooperative financial institution founded on Anabaptist principles. Seeking to be peacemakers remains an important value to our members, and it’s built right into our purpose: “inspiring peaceful…communities”. SRIs help us to achieve our purpose.
4. Importance of Positive Screens
Positive screens evaluate companies based on the good they do and strive to include those that engage in practices that support animal welfare, international labour standards, and the environment, for example.
Nearly two-in-three members feel it is ‘very important’ to have positive screens for transparency with the public and leadership being held accountable, as well as protecting or enhancing human rights. More than half of the market indicated that all positive screens, except encouraging positive labour relations, are ‘very important’. Both groups rated human rights as the most important positive screen to include when evaluating SRIs.
Both members and the market found positive screening to be the most important element of SRI.
SRIs are all about making impactful financial decisions and that’s what Kindred and our members seek to do. A positive screening approach helps ensure that our members’ investments make a difference in the world.
5. Connection Between Charitable Giving and SRI
According to the survey, 70 per cent of Kindred’s members currently incorporate charitable giving into their financial plans. Furthermore, members who feel it is ‘very important’ that their financial institution offer SRIs are also more likely to volunteer, and to have donated to a charity within the previous month.
Respondents who have a formal, written financial plan are more likely to be more knowledgeable about SRIs, to hold SRIs, and use an advisor to help plan charitable giving.
Respondents who feel it is ‘very important’ that their financial organization offer SRIs are more likely to already incorporate charitable giving in their financial plan, volunteer, and/or to have donated money in the last month (at time of survey).
For Kindred, a connection between giving back and SRIs just makes sense—both seek to make a difference in the world!
6. Conclusion
With years of experience working with members to connect values and faith with finances, the findings of our SRI study were not too surprising. It was interesting to learn that the market responses align fairly closely with our members, although there are distinctions. The 2018 Canadian Responsible Investment Trends Report reveals that responsible investment is experiencing rapid growth in Canada, and we need to continue to boost that trend through education and the promotion of values-centred alternatives to mainstream investing. If making positive change in the world is viewed as important, then providing financial products, services, and advice to support that desire is an essential commitment for Kindred to make to our members.
Our research shows that Kindred members place high importance on sharing their time and money with the community in order to make the world a better place, so it makes sense that these values translate to a desire to invest responsibly. In addition to planners and advisors providing guidance to their clients when planning their investments and estates, the same level of attention can be applied to charitable giving. At Kindred, we see this as a great opportunity to put our members’ values into action, which furthers our purpose to connect values and faith with finances, inspiring peaceful, just, and prosperous communities.
How we gathered the data (Methodology): PMG Intelligence contacted a randomly selected group of Kindred members and the general public (“market”) to conduct research that would bring a better understanding of the awareness, perceptions, and expectations of SRI in general and Kindred’s SRI offerings in particular. A total of 675 respondents in Ontario participated in Kindred’s SRI study in October 2018. 228 Kindred members completed the survey either online or over the phone. The results are considered accurate to within 6.46 percentage points 19 times out of 20. 447 market participants completed the survey online, and these results are considered accurate to within 4.64 percentage points 19 times out of 20.
Research Objectives
Through this study Kindred hoped to:
- Determine the awareness and importance of socially responsible investment options;
- Measure knowledge regarding SRI and learn which element of the SRI framework is the most important to members and the market;
- Understand the types of SRI screens that are most important to members and the market;
- Understand member and market values regarding charitable giving and volunteerism in the community and abroad; and
- Consider the propensity for both members and the market to incorporate charitable giving into financial planning and/or use financial advisors to plan their charitable giving.
About PMG Intelligence: PMG Intelligence is a highly experienced market research and intelligence agency with advanced skillsets in mathematics, psychology, sociology, business, and economics. PMG is dedicated to advancing the industry through the development of next-level data capture and data analysis methodologies.