Choosing responsible investment

These goals are essential to financing projects such as buying a home, taking a trip or retiring with your desired standard of living. But what would you say if your investments allowed you to combine your financial interests with your social and environmental convictions?

You can do so thanks to responsible investing (RI). Responsible investing is an approach that, in addition to financial criteria, systematically takes into account environmental, social and governance issues – referred to as ESG criteria - in the selection and management of investments. 

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RI is also about using shareholder power to effect change. It gives investors a voice. Its influence includes the following examples:

Environment

Companies contribute to the fight against climate change by adopting measures that allow them to minimize their environmental footprint.

Social

Companies have a greater respect for diversity and inclusion, which has a positive impact on the community as a whole.

Governance

Companies adopt sound practices by focusing on matters such as diversity, transparency, anti-corruption efforts and excessive senior management compensation.

Responsible investing is based on the premise that taking ESG criteria into account increases the likelihood of a solid financial performance and sound risk management for companies over the medium and long terms.

It was long thought that responsible investing underperformed the traditional management approach, but that is no longer the case. A majority of managers and researchers agree that this type of investment can generate very good, or even better, financial performance over the long term. Research that illustrates this correlation includes a study conducted in 2021 by researchers at New York University’s Stern School of Business and Rockefeller Asset  Management¹.

At FÉRIQUE Fund Management, we think it’s imperative to integrate environmental, social and governance issues into our investment decisions because of the significant impact they can have not only on society and the environment, but also on investment performance. Our approach is three-pronged:

• Proxy voting  
• Integration of ESG criteria into investment analysis and decision making
• Shareholder engagement  

Our goal is to make choices that encourage best practices and motivate companies to adopt better behaviours. This approach applies to the management of all our Funds and Portfolios.

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Two funds were launched last year to offer new investment vehicles that contribute, through their assets, to meeting our major societal challenges: The FÉRIQUE’s Global Sustainable Development Bond Fund and the Global Sustainable Development Equity Fund.

They comprise mainly bonds and shares that finance projects and businesses that emphasize sustainable development or benefit from this approach.

By investing in these Funds, you contribute to the development of major projects, such as public transit and green technologies. You also fund the efforts of companies working to reduce their carbon footprint.

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Investment solutions managed according to the principles of responsible investment are one of the options available to those who want to make a difference.
But you can go even further by directly encouraging businesses and organizations that are firmly committed to changing their ways of doing things.

In the fall of 2021, FÉRIQUE Fund Management received a carbon neutral certification from LCL Environnement in recognition of the firm’s efforts to measure and reduce its carbon footprint. This is a first step in a comprehensive approach to combating climate change.

The Registered Retirement Savings Plan (RRSP) and the Tax-Free Savings Account (TFSA) are vehicles that allow you to grow your savings tax-free with the financial products of your choice. In RRSPs and TFSAs alike, investments can incorporate responsible investing.

Why not take advantage of the RRSP and TFSA period to review how responsible your investments are? The first step is to discuss this matter with a professional.