Key Highlights:
- 73% of Canadians believe responsible investment portfolios are
the way of the future
- 81% believe that responsible investment offers the same or
better returns than traditional investing
- 61% rely on their financial advisor for information about
responsible investment
- 86% believe it is important that companies they invest in act
in a socially responsible way
TORONTO, Jan. 15, 2020 /CNW/ - Canadian investors are
increasingly looking to build responsible investment portfolios,
but they are not sure how to start and are relying on their
financial advisors for guidance, according to a recent survey of
Canadian retail investors by RBC Global Asset Management Inc. (RBC
GAM Inc.).
The RBC GAM survey focused on a broad spectrum of Canadian
retail investors to gauge their attitudes and understanding of
responsible investment. The survey revealed that 63% of Canadian
investors are interested in building responsible investment
portfolios, and 73% of respondents believe responsible investment
is the way of the future. However, nearly 50% of investors do not
know where to find trustworthy information about responsible
investment, suggesting an information gap may be holding them back
from actually allocating their investment dollars into responsible
investment solutions. To overcome this information gap, 61% of
respondents would turn to their financial advisor to learn more
about responsible investment, demonstrating how vital of a role
financial advisors can play in investor education.
"Canadian financial advisors have earned the loyalty of their
clients by providing advice and guidance to help them meet their
financial goals," said Doug Coulter,
President of RBC Global Asset Management Inc. "Responsible
investment is clearly of great interest to Canadian investors. It
represents another opportunity for advisors to work with their
clients to provide information and recommendations to help
investors turn their interest into action."
Financial advisors play a crucial role in responsible
investment
Canadian investors view their financial advisors
as the most trusted source to learn more about responsible
investment. The RBC GAM survey found that 76% of respondents said
it was important for their advisor to have expertise in responsible
investment, and to offer responsible investment solutions.
Moreover, 48% of respondents said they are likely to have a
conversation with their advisors focused on responsible investment
within the next year.
"When it comes to responsible investment, Canadians have a clear
interest and desire to learn more," said Melanie Adams, Vice President and Head of
Corporate Governance and Responsible Investment at RBC GAM Inc.
"There is a role for asset managers, industry associations,
advisors and regulators to help increase education around
responsible investment, with the ultimate goal of enabling
Canadians to make informed decisions."
Other key findings:
A performance trade-off is not a worry for investors: 81%
of respondents believe that responsible investment offers the same
(62%) or better returns (19%) than traditional investments. When
segmented, 30% of younger investors (aged 18-34) believe that
returns from responsible investment are superior to those earned in
traditional investments.
Responsible investment is expected to grow: Despite 63%
of investors being interested in building responsible investment
portfolios, only 30% of respondents expect responsible investment
to make up a larger part of their investment portfolio within the
next five years. This may point to the information gap investors
are experiencing, and uncertainty about how to turn an interest in
responsible investing into action. When analyzed by demographics,
40% of younger investors (aged 18-34) are likely to allocate a
larger portion of their portfolio to responsible investment over
the next five years, and are more likely to do so than older
investors (35+).
Conversations equal action: When clients discuss
responsible investment with their financial advisor, a
recommendation of responsible investments was received by 89% of
these respondents. When asked if they have engaged in a
conversation around responsible investment with their financial
advisor, younger investors (18-34) (45%) and those residing in
British Columbia (46%) and
Quebec (38%) were substantially
more likely to have engaged in a conversation than older investors
(35+), and those residing in Ontario (27%) or the Atlantic provinces
(19%).
A knowledge gap is holding adoption back: Of the
respondents who said that they are not interested in responsible
investment, the top reason, cited by 31% of them, was that they do
not know enough about it to be interested. Notably, women (42%) and
younger investors (18-34) (38%) were most likely to respond that
they do not know enough about responsible investment, despite their
overall higher interest level in adopting responsible investment
portfolios.
Investors are looking for the companies they invest in to act
responsibly: When investors were asked about the importance of
the companies they invest in acting in a responsible manner, 86% of
respondents noted it was either "very important" or "somewhat
important". In terms of importance, 42% of younger investors
(18-34) noted it was "very important". This was particularly
prevalent in British Columbia,
where 40% of all respondents said it was "very important".
Environmental causes matter most to investors: For
almost half (45%) of respondents, environmental causes, such as
climate change and water, matter the most in socially responsible
investments. Almost a third of respondents (32%) ranked social
causes, such as health and safety, human rights and communities as
most important, while ten percent rated governance issues such as
board diversity and CEO compensation as the most important socially
responsible cause.
To learn more about RBC Global Asset Management's approach to
responsible investment, please visit www.rbcgam.com/ri-ready.
About the RBC GAM Survey:
These findings are from an
Ipsos survey conducted on behalf of RBC Global Asset Management
Inc. between August 13, 2019 –
August 23, 2019. In total, 1,500
Canadian retail investors, who were either currently investing, or
considering investing over the next two years, were surveyed evenly
based on asset level: <$25,000;
$25,000 to <$100,000; $100,000
to < $250,000; and $250,000 +. The findings were then weighted by
age, gender, region, as well as asset level according to Ipsos CFM
Asset data to ensure that the findings reflected the actual asset
distribution of Canadians. The survey is accurate within a
credibility interval of ±2.9 percentage points, 19 times out of 20.
All sample surveys and polls may be subject to other sources
of error, including, but not limited to coverage error, and
measurement error. RBC GAM Inc. is a member of the RBC GAM group of
companies and an indirect wholly owned subsidiary of Royal Bank of
Canada.
About RBC Global Asset Management
RBC Global Asset
Management (RBC GAM) is the asset management division of Royal
Bank of Canada (RBC) and includes
money managers BlueBay Asset Management and Phillips, Hager &
North Investment Management. RBC GAM is a provider of global
investment management services and solutions to institutional,
high-net-worth and individual investors through separate accounts,
pooled funds, mutual funds, hedge funds, exchange-traded funds and
specialty investment strategies. The RBC GAM group of companies
manage approximately $460 billion in
assets and have approximately 1,400 employees located across
Canada, the United States, Europe and Asia.
About RBC
Royal Bank of Canada is a global
financial institution with a purpose-driven, principles-led
approach to delivering leading performance. Our success comes from
the 85,000+ employees who bring our vision, values and strategy to
life so we can help our clients thrive and communities prosper. As
Canada's biggest bank, and one of
the largest in the world based on market capitalization, we have a
diversified business model with a focus on innovation and providing
exceptional experiences to 17 million clients in Canada, the U.S. and 34 other countries. Learn
more at rbc.com.
We are proud to support a broad range of community initiatives
through donations, community investments and employee volunteer
activities. See how at rbc.com/community-social-impact.
SOURCE RBC Global Asset Management