5 great reasons to choose responsible investment
Thinking of getting into responsible investment but don’t have the information you need? Here are 5 great reasons to make the leap and help contribute to sustainable development and the well-being of communities.
1. You’ll be investing according to your values and priorities
Are you concerned about climate change, human rights, community rights and diversity on the boards of large corporations? Responsible investment (RI) could help you better align your investments with your personal beliefs.
This type of investment offers attractive potential returns while allowing you to use your savings to help drive change.
How? By giving you the opportunity to support companies that are seeking to better manage their environmental, social and governance (ESG) practices and that are adapting to regulatory, technological and social developments.
2. You’ll be promoting more comprehensive company analysis
Responsible investment combines financial analysis with an assessment of ESG criteria to better understand a company’s strategy, value, risk exposure and ability to seize business opportunities and create long-term value for its stakeholders (shareholders, employees, clients, community, etc.).
For each of these criteria, we analyze how companies behave in relation to various issues, as illustrated by the examples below.
Environment
Is the company taking biodiversity, water management and the energy transition into consideration in its operations?
Social
Does the company respect workers’ rights and support local communities?
Governance
Does the company take acceptable positions on compensation and ethical use of AI?
Assessing ESG factors enhances financial analysis. It offers clearer insight into a company’s strategy, its exposure to certain risks, its ability to adapt to a changing environment and, more broadly, its ability to create long-term value for its shareholders, employees, clients and community.
Investing with purpose
For some people, it’s important that their investment choices reflect their personal beliefs, and RI solutions can meet that need. With this mind, the Desjardins Sustainable Funds lineup excludes certain companies because of their activities. These include companies involved in the production and distribution of tobacco and vaping products, fossil fuel production and transportation, and firearms.1
3. You’ll be helping improve corporate practices
Responsible investment can have spillover effects on people, but also on companies. RI can encourage companies to adopt responsible business practices.
As interest in ESG criteria increases, companies will continue to strengthen their ESG practices and enhance their ability to adapt to their changing environment.
4. You’re helping drive change and make things happen
Stewardship is a true driver of change—and one of the most important aspects of responsible investment. For institutional investors, stewardship is about “the use of investor rights and influence to protect and enhance overall long-term value for clients and beneficiaries, including the common economic, social and environmental assets on which their interests depend.”2 In other words, when you choose responsible investment, your money helps support portfolio managers’ stewardship actions to promote the long-term value of investments while fostering sustainable benefits through improved environmental, social and governance practices.
Dialogue that pays off
Desjardins Sustainable Funds and Portfolios managers are engaging in conversation with companies, and it helps making a difference. For example:
Companies are speeding up their energy transition by reducing their dependence on fossil fuels.
Car manufacturers are expanding their range of low-emission vehicles to reduce their greenhouse gas emissions.
Companies in all sectors are setting up programs to improve diversity on boards of directors.
To learn more about recent developments in responsible investment, read our annual report.
Using the levers of stewardship—such as voting at shareholder meetings, engaging in dialogue with companies, and encouraging them to adopt better practices—helps deliver benefits for a better today and tomorrow.
5. You’ll be creating the potential for long-term value
More and more people are becoming aware of responsible investment, but they still have some reservations, particularly that this type of investment means compromising on returns.
As with any investment, performance depends on a number of factors, including economic conditions, markets and management styles. Responsible investment is no different. For example, excluding or underweighting certain sectors may lead to performance gaps—which could be positive or negative depending on the market backdrop—compared to other solutions that don’t apply the same strategies.
RI goes beyond looking for financial returns. RI approaches also aim to create long-term sustainable value and have a positive impact on society and the environment.
Choosing RI means investing in future generations
By investing in companies selected for their financial strength and business model based on sustainable practices, you're making a significant contribution to the health of your family, your community, your country and the planet we all care about. At the same time, you're helping to shape a better world, today and tomorrow.
Desjardins is here for you
Our advisors are always available to answer your questions and help you make investment decisions. Contact us for more information or to start investing in responsible investment products.
To learn more about our different approaches to responsible investment, check out our:
1. Thresholds and exceptions may apply. For more details, refer to the Desjardins Funds and Desjardins ETFs Responsible Investment Policy.
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Desjardins Funds and Desjardins Exchange Traded Funds are not guaranteed. Their value fluctuates frequently, and their past performance is not indicative of their future returns. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Desjardins Global Asset Management Inc. is the portfolio manager of Desjardins Exchange Traded Funds. Desjardins Funds and Desjardins Exchange Traded Funds are offered by registered dealers.
Desjardins Funds are not guaranteed, their value fluctuates frequently, and their past performance is not indicative of their future returns. The indicated rates of return are the historical total compound annual returns as at the date of this document, including changes in securities value and reinvestment of all distributions, and do not consider sales, redemption, distribution or other optional charges, or income taxes payable by any security holder that would have reduced returns. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Desjardins Funds are offered by registered dealers.