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.
Responsible investing in the United States showed a 38% growth between 2016 and 2018, and 18-fold increase since 1995, according to US SIF Foundation.
What is 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.
What is 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
What is 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:
- Environmental concerns — Including climate change, natural resources conservation, pollution and waste management, and water scarcity.
- Social issues — Such as corporate philanthropy, community and government relations, workplace health and safety, human rights and diversity.
- Governance topics — Including accounting practices, board accountability and structure, disclosure practices, executive compensation, corporate ethics, regulatory compliance and transparency.
Any investor can participate in responsible investing. It is available to all, beyond the traditional large asset managers, institutional investors, foundations and high-net-worth investors.