Canadian firm launches socially responsible investing today

Portfolio includes ETFs that prioritize low carbon emissions and advanced cleantech innovation

There was once a time when the emphasis for most investors was to simply make more money and secure their financial future. However, in today’s more socially-conscious times an increasing number of investors are thinking just as much about the wider world as they are about themselves.
That’s why Wealthsimple is today (March 24) launching its Socially Responsible Investing (SRI) portfolio.

“In recent years, the number of Canadians looking to invest in socially responsible portfolios has increased dramatically and we’re seeing a lot of millennials looking to align their values with their investments,” commented Mallory Greene, marketing manager at Wealthsimple. “It’s been highly requested by our clients and we’re excited to make investing in a socially responsible manner more accessible.”

So what exactly will the SRI portfolio involve?

Simply put, SRI portfolios will invest in companies that do business in a socially responsible way. This is an investment and not a charity, however – so Wealthsimple has aimed to design a portfolio using ETFs that prioritize low carbon emissions, advance cleantech innovation, and promote sustainable growth in emerging markets while at the same time offering diversification and low fees.
Here are the ETFs included in the Wealthsimple ETF portfolio:
  • iShares MSCI ACWI Low Carbon Target ETF (CRBN): Global stocks with a lower carbon exposure than the broader market
  • iShares Jantzi Social Index ETF (XEN): Canadian stocks, excluding companies with a poor social responsibility record based on broad ESG criteria
  • Vident International Equity Fund (VIDI): Developed and emerging economies with sustainable growth, based on criteria such as human rights and low corruption
  • PowerShares Cleantech Portfolio (PZD): Cleantech innovators in the developed world
  • BMO Mid Federal Bond Index ETF (ZFM): Fixed-income exposure via Canadian government bonds, in order to optimize for risk

Greene is confident in the portfolio’s success, pointing out that SRI has grown ten-fold during the last 20 years and that there is now $22 trillion in assets worldwide in SRI funds. Indeed in Canada alone, SRI accounts for 20 per cent of all financial assets.

“Transparency is a big issue within the financial industry and I don’t think people know exactly what they’re investing in,” she said. “I expect SRI funds to continue to grow in popularity, as we increase awareness and education surrounding the topic. We’re all looking for ways to make the world a bit better, and it’s nice to know that I’m simultaneously making a positive impact, and improving my financial wellbeing.”