Responsible investing

Align your financial goals with your personal values

“We recognize our clients’ growing interest in aligning their investments with their deeply held personal values. That’s why we are proud to help clients include any number of responsible investing options in their wealth planning decisions.”

Michael Armstrong, CEO of RBC Wealth Management - U.S.

Every portfolio has environmental and social risk. Investors who are increasingly concerned with what risks may be present in their investment portfolios should consider responsible investing.

RBC Wealth Management supports the merits of responsible investing. RBC is committed to community involvement, diversity and inclusion, and environmental responsibility to help the world become a better place—for both current and future generations. To help make good on our commitment to have a positive social and environment impact, we have pathways for you to invest capital in a more responsible manner.

A growing trend

Responsible investing assets have skyrocketed to $12 trillion as of 2018, a 38% increase in two years, according to the US SIF Foundation. This is projected to grow exponentially.

Responsible investing encompasses a number of investing approaches you may have heard of, including Socially Responsible Investing (SRI), Environmental, Social, and Governance Investing (ESG), and Impact Investing.

Responsible investment
Socially responsible investing

Create or withdraw support for companies/sectors in portfolio that do/don’t meet personal values.

ESG integration

Support companies that perform well on environmental, social and governance metrics.

Impact investing

Support social or environmental issues with the expectation of measurable results.

Socially responsible investing

Socially responsible investing is also known as values-based or ethical investing. Investors are looking to make a positive change by aligning their personal values with their investment choices. This involves both negative and positive screening of companies, industries or sectors to make a financial influence that match their values.

Negative screening
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Tobacco

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Alcohol

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Weapons

Positive screening
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Social housing

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Renewable energy

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Human rights

Environmental, social and governance (ESG) investing

ESG investors are seeking companies with leading environmental, social and governance metrics compared to their peers. These metrics may include:

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Environmental concerns — Including climate change, natural resources conservation, pollution and waste management, and water scarcity.

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Social issues — Such as corporate philanthropy, community and government relations, workplace health and safety, human rights and diversity.

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Governance topics — Including accounting practices, board accountability and structure, disclosure practices, executive compensation, corporate ethics, regulatory compliance and transparency.

Impact investing

Impact investing is not charity. It is an investment where an investor is hoping first and foremost to generate social or environmental impact. An impact investor also wants to earn a return on their investment. However, they may be willing to take a capital loss as long as some tangible result for the investment can be seen. In that way, it is essential to be able to measure the impact of this investment. An example includes investment in low-income housing loan assistance, where a tangible impact is measurable (i.e., number of households able to afford housing) and the investor is likely to get his or her money back.

Impact investing—a third dimension of performance
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Traditional investing

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Impact investing

Next steps

Today, more consumers are making a difference with their dollars. Sustainable products and solutions matter. Whether it’s your preference for clean energy, consumer goods or clothing, the trend toward more Earth-conscious companies is not likely to slacken.

If you are interested in learning more about this topic, please contact your RBC Wealth Management financial advisor and ask about how you can integrate responsible investing into your portfolio.

1RBC Wealth Management received the highest score in the J.D.Power 2020 U.S. Full-Service Investor Satisfaction Study of customer satisfaction with full-service investment firms. Visit jdpower.com/awards.

 

Investment and insurance products offered through RBC Wealth Management are not insured by the FDIC or any other federal government agency, are not deposits or other obligations of, or guaranteed by, a bank or any bank affiliate, and are subject to investment risks, including possible loss of the principal amount invested.

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