TORONTO, April 21, 2021 /CNW/ - According to a SOM1 survey commissioned by Desjardins, 28% of Canadians2 believe that responsible investment (RI) products provide lower returns than traditional investments. The misconception is on the rise, from 16% in 2016 and 24% in 2018. And yet, the Responsible Investment Association (RIA) recently released data showing that the average returns of RI funds matched or outperformed the average for all funds in each of the main asset classes, across all reference periods.
"Clearly, the myth that responsible investments are less profitable persists, despite actual results," said Marie-–Justine Labelle, Head of Responsible Investment at Desjardins Investments Inc., the manager of Desjardins Funds. "The RIA's data compilation for the main asset classes, dated December 31, 2020, leaves no room for doubt. These numbers aren't surprising. They reflect the broader approach to risk management associated with the application of environmental, social and governance (ESG) criteria. In short, it could be very much possible to invest responsibly without sacrificing potential returns."
Reasons for choosing RI products
Survey respondents who expressed interest in responsible investing stated their main reasons for choosing RI products as positive impacts for society and the planet (75%), good return potential (54%), evidence demonstrating that their investments generate concrete benefits (53%) and the idea of being consistent with their lifestyle or convictions (48%).
Among respondents who weren't likely to invest in RI products, the main motivators to do so would be good return potential (61%), evidence demonstrating that their investments generate concrete benefits (29%), a positive impact on society and the planet generated by the investment (28%), and a recommendation from their advisor (16%).
ESG concerns now dominate
Slightly more than half of survey respondents said they were very concerned about cybersecurity (51%), climate change (51%) and human rights (50%). Next came concerns for biodiversity (45%), air quality (43%), water management (41%), child labour in developing countries (41%), integrity of corporate governance practices (39%), workers' rights (38%), waste management (36%) and food waste (34%). "These concerns are central to the responsible investment mutual funds and exchange-traded funds (ETFs) that Desjardins offers Canadians," stated Marie-Justine Labelle, who holds a master's degree in Environmental Policy and Regulation from the London School of Economics and Political Science.
Sharp rise in responsible investments in Canada
Responsible Investing is a form of investing that considers environmental, social and governance (ESG) issues while still focusing on the potential for returns. Responsible investing portfolios are designed for investors who want to see their investments grow while supporting businesses that promote sustainable development and social responsibility. In Canada, according to the Investment Funds Institute of Canada (IFIC), RI products (mutual funds and ETFs) represented $20.1 billion in assets at December 31, 2020, marking a 55%3 increase over the last year.
With approximately 30 different options (mutual funds, structured products, and ETFs), Desjardins has the most comprehensive RI product line in Canada, with $7.3 billion in assets under management. That leadership is reflected in the fact that 30% of Desjardins members hold mutual funds that include Desjardins SocieTerra Funds and SocieTerra Portfolios, totalling almost $5 billion in assets. Desjardins also has nine Low CO2 ETFs, the largest range in Canada.
About Desjardins Group
Desjardins Group is the largest cooperative financial group in North America and the fifth largest cooperative financial group in the world, with assets of $362.0 billion. In 2020 it was ranked as one of the world's Top 100 Employers by Forbes magazine. To meet the diverse needs of its members and clients, Desjardins offers a full range of products and services to individuals and businesses through its extensive distribution network, online platforms and subsidiaries across Canada. Ranked among the World's Strongest Banks by The Banker magazine, Desjardins has one of the highest capital ratios and credit ratings in the industry.
The Desjardins Funds are not guaranteed, their value fluctuates frequently, and their past performance is not indicative of their future returns. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. The Desjardins Funds are offered by registered dealers.
The Desjardins Exchange Traded Funds are not guaranteed, their value fluctuates frequently, and their past performance is not indicative of their future returns. Commissions, management fees and expenses all may be associated with an investment in exchange traded funds. Please read the prospectus before investing. Desjardins Global Asset Management Inc. is the manager and portfolio manager of the Desjardins Exchange Traded Funds. The Desjardins Exchange Traded Funds are offered by registered dealers.
1 The SOM survey commissioned by Desjardins surveyed 2,860 Canadians between November 25 and December 14, 2020. The maximum margin of error is ± 2.5%, 19 times out of 20.
2 2020 survey results differ from one province to another. While 28% of respondents, Canada-wide, mistakenly believe that RI delivers lower yields, regional numbers were 30% in Ontario, 22% in Quebec, and 33% in Alberta and British Columbia.
3 IFIC 2020 Investments Fund Report.
SOURCE Desjardins Group
View original content to download multimedia: http://www.newswire.ca/en/releases/archive/April2021/21/c4829.html