We believe sustainable companies offer long-term value.
Investors are recognizing that they don’t have to choose between seeing good returns and supporting worthwhile causes. Socially responsible investing (SRI) enables them to make investment decisions that align with their values while also reducing financial risk and achieving stronger long-term financial performance.
SRI involves choosing and managing investments based in part on how companies impact people and the planet, and how they manage their businesses and operations. It’s an investment approach that considers environmental sustainability, social responsibility, and corporate governance risks (ESG) when making investment decisions.
In addition to evaluating the financial benefit of the investment, SRI involves:
- Choosing not to invest in companies involved in potentially harmful industries, such as tobacco, nuclear power, pornography, or gambling.
- Choosing to invest in companies that are working toward making the world better for people and the environment.
- Choosing to invest in impact areas—companies or projects dedicated to solving specific problems for the environment or society.
- Choosing companies based on their environmental, social, and governance (ESG) performance.
Support for this type of investing is growing: SRI products now make up over one-fifth of assets under management in the United States and one-third of all assets under management in Canada.
80% of BC residents say they have either invested in SRI or are interested in doing so.1
47% of B.C. residents would move their money out of an investment in an unethical company.1
Companies showing strong commitment to sustainability outperform traditional investments.2
1 2017 Vancity/Insights West survey.
2 Eccles, Robert G., Ioannou, Ioannis, and Serafeim, George. “The Impact of Corporate Sustainability on Organizational Processes and Performance.” Harvard Business School.
About socially responsible investing
When selecting investments for the Vancity Investment Management (VCIM) portfolios, attention is given to factors, other than financial factors, that are identified as critical in the overall evaluation of a company’s prospects for future returns. We believe that by doing so, we can provide returns through an extra level of risk mitigation and added alpha.
The investment decision making process looks to insights derived from fundamental financial analysis and an assessment of an issuer’s performance respecting environmental, social and governance (ESG) practices such as corporate governance, employee and community relations, environmental management, diversity, human rights, and sustainable products.
Responsible investment is incorporated into the investment process using screening, engagement and proxy voting.
VCIM’s advantage with SRI
Once VCIM invests in a company, the shareholder engagement tool allows for further enhancement of value by encouraging environmental, social and governance best practices. Shareholder engagement includes:
- direct dialogue with company leaders and board of directors
- shareholder proposals
- proxy voting
VCIM adopts Shareholder Association for Research and Education’s Proxy Voting Guidelines
Access guidelines here.
Diversity, Equity, Inclusion and Reconciliation Investment Statement
At VCIM, we acknowledge the role that finance plays in creating a better society and helping remove barriers that have historically excluded many Indigenous, Black, and People of Colour (IBPOC), and other equity-deserving groups from access to capital. We act on our fiduciary responsibilities by incorporating principles of Diversity, Equity, Inclusion, and Reconciliation (DEIR) into both investment decisions and shareholder engagement. We are taking actions to not only prevent perpetuating systemic exclusion but use our capital allocation for investing in ways that ensure the economy on a whole is more inclusive. We are committed to driving tangible change within our industry, focusing on identifying and dismantling systemic racism in all aspects of our work, and actively implementing anti-racist practices. We understand that this journey will be uncomfortable, requiring curiosity and humility as we unlearn and learn.
VCIM embeds DEIR and anti-racism into our investment strategies in these core ways:
Investment selection: We seek investment opportunities in companies that are implementing best practices on DEIR both in their internal operations and in the impacts their products and services have on communities and supply chains. We avoid or divest from companies that are either profiting explicitly from systemic oppression or failing to sufficiently prevent poor practices (when we find evidence suggesting organizational human rights violations, inadequate oversight, discriminatory practices, or a culture promoting bias and inequity).
Shareholder engagement: We undertake shareholder engagement to push companies to take sector relevant actions at the appropriate scale, to improve their integration of DEIR with their organizational structure, strategy, planning and operations. Engagement includes undertaking direct dialogue with senior leaders, filing shareholder proposals on DEIR related issues, and ensuring that we use our rights as shareholders to vote our proxies at annual general meetings (AGMs) for proposals that advocate for the adoption of leading DEIR practices required to create true inclusivity.
Collaboration and advocacy: We advocate and collaborate with other investors for improved disclosures and regulations related to DEIR that can help promote the dismantling of systemic oppression, discrimination, and exclusion. We also partner with others on this same mission to improve our ability to influence, at scale.
Continuous Improvement: We work to stay ahead of the curve, learning and unlearning by continuously seeking current thought leadership to stay on top of emerging DEIR issues. We analyze and re-analyze our portfolios for new exposures and take actions to improve and implement best practices. We see our investment process as a living process, always evolving to meet current equity needs and maintain a willingness to course correct when our actions are not yielding the right DEIR results.
It is through these actions that we will effect change in our system and industry. The VCIM Investment team is committed to continuing to embed anti-racism practices throughout our work while advancing anti-racism efforts throughout the investment industry, creating greater equity, inclusivity, and respect for all.
We engage with companies to address environmental issues, such as the use of pesticides that threaten the ecosystem by harming bees.