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Make a socially responsible investment!

Actu - blogue investissement responsable

By Rosalie Vendette
Senior Advisor - Socially responsible investment - Desjardins

It’s never too early to start thinking about the best way to save. For many, our sole concern is whether we will have saved enough by the time we retire. But what of the decisions we make when we invest our savings for retirement? First and foremost, we must consider the following:

  • On what criteria do you base your investment decisions?
  • How long will it take for your investments to grow?
  • What’s your risk profile?

Your answers to these questions will help determine the investment strategy that best suits your needs. Perhaps an investment that helps the environment while offering an attractive return is right for you.

Investing in the environment

More and more people are leaning towards investing in companies that stand for the same principles they value. Responsible investing (RI) puts you in a position to influence a company’s environmental, social and governance practices as a shareholder. It’s a smart risk management strategy: you bring attention to important issues that affect us all, such as climate change, biodiversity and water scarcity and affect a change directly through the listed companies.

Finding “the perfect company”

We’re still looking. Unfortunately, the perfect company may not exist on the stock market. Companies’ activities contribute a great deal to environmental problems, particularly those in the energy and materials sector such as mining. These are the sectors where investors need to intervene, and where SRI can have the greatest impact through shareholder engagement, particularly in Canada.

Making a difference by investing

In finance, the most effective way to influence a company’s practices is to become a shareholder. SRI gives shareholders the opportunity to open a dialogue with the companies in which they own a stake. And if that fails, they can submit a proposition at a shareholders’ meeting. These meetings—open to members of the press— offer shareholders the opportunity to voice their concerns publicly. Propositions are then put to a vote. You’d be surprised by how effective this approach can be.

Boycotting for change

Even if you take a stand and decide not to invest in a company for environmental reasons, very few will follow suit. And that’s why boycotting goes all but unnoticed in the financial sector. The best way to incite change is from within; invest in a company and use your status of shareholder to share your concerns.
If after several attempts, you still haven’t made any progress, it may be time to consider divesting and sell your shares.

The products

There are many RI products available in Canada which take into consideration companies’ environmental impacts.
If you’re looking for a product that supports companies that were selected based on their environmental practices, the Desjardins SocieTerra Environment Fund was created for you. The following criteria were used in selecting the companies in this portfolio:

  1. Greenhouse gas emissions
  2. Water consumption
  3. Use of lands and ecosystems
  4. Production of waste and pollution

For more information on SRI, visit letsthinkri.com and the Responsible Investment Association website. To find out more about Desjardins’s products, visit desjardinsfunds.com or speak to your personal financial advisor or financial planner.