Survey confirms rising interest, reveals top ESG issues and barriers to increased adoption
As the COVID-19 pandemic continues to affect the most vulnerable members of humanity, Canadian investors are increasingly considering the wider impact of their capital allocation decisions.
In a new sustainable investing survey conducted by Mackenzie Investments, 55% of respondents indicated that they have grown more likely to consider the positive impact they can make on society through their investing decisions. Nearly seven tenths of respondents (69%) also shared a feeling that investing in a sustainable manner is increasingly important.
Nearly one third of Canadian investors surveyed said that they currently invest sustainably; of those, 69% said that they plan to increase their holdings within two years. One third of investors who currently don’t hold any sustainable funds said they intend to add them to their portfolios in the next few years.
“It’s encouraging that sustainable investing is gaining significant traction among Canadians,” Fate Saghir, SVP & head of Sustainable Investing at Mackenzie Investments, said in a statement. “Though it shouldn’t come as a big surprise – Canadians tend to be very aware of the world around them and the impact we have on our society.”
When asked what factors hold them back from sustainable investing, 40% of investors cited a shared perception that sustainable investing leads to lower returns. But recent empirical evidence casts doubt on that belief.
A recent Morningstar study found that out of 87 sustainable funds, 64 outperformed their category peers on a risk-adjusted basis after fees for the 2020 calendar year. Similarly, figures from the Responsible Investment Association of Canada indicate that on average, Canadian fixed income, Canadian equity, U.S. equity, and global equity responsible investment funds were able to exceed the broad average performance within each of their respective fund categories.
Mackenzie’s study also surveyed the top issues that Canadians who currently hold sustainable investments want to support moving forward, which include:
- Climate change/environment (66%);
- Human rights (50%); and
- Gender diversity/equality (41%).
“For those unsure how to get started, it’s important to share your personal priorities with your advisor, understand the investment objectives of the funds you’re investing in and ensure that you research the top holdings in your funds and portfolios,” Saghir stressed. “