Responsible and sustainable investing


Today’s environmental and societal challenges have the potential to undermine the ability of our clients, employees, shareholders, and communities to thrive and prosper. We want to do our part to help address these challenges and aim to engage others to contribute to addressing them.

As an investor, you have the power to support the growing number of companies embracing innovative sustainability and responsible business practices through your investments.

We can help by aligning your investments with your values and financial goals through our approach to responsible and sustainable investing. But we understand that navigating the world of responsible and sustainable investing can be complex. We’re here to guide you through the different approaches and industry terminology to help you to make informed investment decisions.

What is responsible investing?

Responsible investing is an umbrella term that refers to the deliberate inclusion of environmental, social and governance (ESG) considerations into an investment portfolio.

What is sustainable investing?

Sustainable investing involves investing with the explicit intention of achieving positive sustainability outcomes (i.e. with a sustainability objective) alongside financial returns.

Our Responsible and Sustainable Investment Framework (RSIF)

We have developed a comprehensive framework that gives you greater transparency and clarity about your investments.

The framework aligns with the Financial Conduct Authority’s Sustainability Disclosure Requirements (SDR) anti-greenwashing rules and the SDR labelling regime to help consumers navigate responsible and sustainable investment products and make informed investment decisions.

Understanding our approach

At the heart of our investment approach is a distinction between a “core” responsible investment strategy and an “additional” sustainable investment strategy. These two approaches are explained below.

* For discretionary investments

Core: Responsible Investment

Who’s it for?

As a discretionary investment client, you automatically benefit from our core responsible investment approach. This approach is applied to all direct equities and funds covered by our central research team, ensuring that your investments are managed responsibly.

What’s the objective?

Our core approach aims to meet your investment objectives, namely, maximise investment returns for a given level of risk.

How do we apply the approach?

Depending on your preferences, we can tailor your portfolio by excluding specific sectors, screening funds or companies based on ESG factors, and including thematic investments.

What’s the key feature?

It’s important to note that while our core responsible investing products may have sustainability characteristics, they do not have sustainability objectives.

ESG integrationIncorporating financially material ESG factors into traditional financial investment decision making to identify potential risks and opportunities and improve long-term, risk-adjusted returns.
StewardshipThe responsible allocation, management and oversight of capital to create long-term value for clients and beneficiaries leading to sustainable benefits for the economy, the environment and society.
ExclusionsApplying screens to exclude assets from the investment space.
ThematicInvesting in assets involved in a particular ESG-related theme or seeking to address a specific social or environmental issue.

Additional: Sustainable investment

Who’s it for?

Our additional sustainable investments are designed for discretionary investment clients who have expressed additional sustainability-related preferences or requirements¹.

What’s the objective?

These investments will have specific sustainability objectives, as defined by the SDR regulations. By investing in these funds, you can align your portfolio with your values and contribute to positive environmental and social outcomes.

How do we apply the approach?

Our sustainable investment approach builds on our responsible investment approach. Sustainable funds integrate environmental, social and governance (ESG) factors, engage in stewardship activities and may also include exclusions. They also have ‘additional’ sustainability objectives.

What’s the key feature?

These investments fall under four labels: Sustainability Focus, Sustainability Improvers, Sustainability Impact, and Sustainability Mixed Goals. Each must meet specific criteria, and focus on delivering sustainability outcomes.

SDR-labelled fundsInvesting with the stated intention of achieving positive sustainability outcomes (a sustainability objective). Products must meet criteria to use one of the four labels below as part of the FCA’s SDR regime.
Sustainability Focus™Invests in assets that are environmentally and/or socially sustainable, determined using a robust, evidence-based standard that is an absolute measure of sustainability.
Sustainability Improvers™Invests in assets that may not be sustainable now but have the potential to improve environmental and/or social sustainability over time.
Sustainability Impact™Achieves a pre-defined positive measurable impact in relation to an environmental and/or social outcome.
Sustainability Mixed Goals™Invests at least 70 percent in a mix of assets that either focus on sustainability, aim to improve their sustainability over time, or aim to achieve a positive impact for people or the planet (a combination of the sustainability objectives for the other labels).

¹ Important: Until SDR rules are published for wealth and portfolio managers, we will not be able to offer ‘sustainability investment’ labelled products or services. When the rules are published, we may be able to offer labelled products or services, supported by an appropriate advice, suitability, and governance process. However, from July 2024 clients may have exposure to SDR-labelled funds in their portfolios.

Our commitment

At RBC, our purpose is to help clients thrive and communities prosper. This includes addressing societal challenges that could impact our collective success, which we believe are critical to the prosperity of the communities where we live and work.

In 2023, RBC introduced its Purpose Framework – Powering Ideas for People and Planet, which aims to provide clarity and structure around three societal ambitions where we believe RBC can have a meaningful impact. Our ambitions are to:

  1. Accelerate the transition to a greener economy
  2. Equip people with skills for a thriving future
  3. Drive more equitable prosperity in our communities

But we know ambitions are not enough. We will drive towards our ambitions, leveraging the full force of our global organisation – our business and operations, people, research and insights and community investments – to make important contributions.

Find out more about how we are powering ideas for people and planet.

This document contains general information only. It is not intended to be specific investment advice, or an investment recommendation. Please bear in mind that the investments and services contained within this document may not be suitable for all investors.

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Invest with a greater purpose

RBC Wealth Management can help you integrate responsible and sustainable investments into your portfolio.

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