Credit Union first to qualify GICs as SRI

Credit Union first to qualify GICs as SRI

Credit Union first to qualify GICs as SRI

Mennonite Savings and Credit Union (MSCU) announced that they are the first Canadian financial institution to show that all of its GICs qualify as SRI. Until now, the SRI approach to investing, which includes sustainable screens, has only been associated with mutual funds and market investments.

“Many financial institutions, including MSCU, have offered Responsible Investment options but MSCU is leading the way by integrating environmental and social factors into all of their GICs,” says Deb Abbey, the chief executive officer for the Responsible Investment Association. “We're very excited to see them take this initiative.”

Responsible investing is playing an increasing part in the investments of Canadians.  According to the RIA, the RI market comprises more than 30% of Canadian assets under management.

“We are thrilled to be a leader in SRI,” said Brent Zorgdrager, CEO of MSCU. “Our commitment to our members is to continue to look for ways to offer values-based products that connect faith and values with finances, inspiring peaceful, just, and prosperous communities. Investments in the MSCU SRI GICs provide our members with the confidence that their funds support loans which clearly align with a sustainable, responsible view of their communities and the world.”

Sustainalytics, a leading global provider of environmental, social and governance (ESG) and corporate governance research and ratings, helped MSCU develop a set of socially responsible lending criteria to incorporate into its agricultural and commercial lending practices. These criteria include screening business borrowers for any involvement in industries such as alcohol, tobacco, and gambling and for any significant negative impacts on the environment, human rights, or communities.

Once the screens had been in place for six months, Sustainalytics carried out a review of MSCU's loan portfolio to validate compliance with the socially responsible criteria. Because these loans are funded by members' GIC deposits, the screens in place ensure the GICs are SRI compliant. 

“MSCU's socially responsible GICs address a growing demand among individual investors considering the environmental and social impacts of their investments,” says Sustainalytics' CEO Michael Jantzi. “MSCU has embedded socially responsible criteria into its lending processes in an innovative way and in doing so is providing individuals with greater access to SRI retail banking products, enabling them to align their investments with their values.”

Mennonite Savings and Credit Union (MSCU) is a financial cooperative providing banking services to more than 20,000 members in communities across southern Ontario. It has more than $950 million in assets under administration and ranks 10th among credit unions in Ontario.