Wednesday, February 23, 2011

SRI Monitor hosts Ottawa seminar

Money talks? What are your dollars saying? SRI Monitor is hosting a seminar on socially responsible investing in Ottawa on Wednesday, April 20, at 7pm. The exact location will be announced when we have a better idea of the number of attendees.

The educational seminar is an introduction to socially responsible investing with Toronto advisor and SRI specialist Sucheta Rajagopal.

Your investment dollars can be used as a powerful lever for positive social and environmental change.

In your RRSP, or non registered investments you may own companies, whether through mutual funds or individual equity holdings, whose policies or practices you do not agree with. Do you have tobacco companies or arms manufacturers in your portfolio? Are you concerned about human rights while owning companies who are committing human rights violations?

On the other hand, are you interested in investing in clean and green technologies, but not sure how they fit into your portfolio or investment strategy?

Socially responsible investors recognize not just the financial bottom line, but a triple bottom line respecting people, planet, profits

Learn more about how to invest in a manner that is consistent with both your financial needs and your personal values.

Sucheta has an LL.B. from Osgood Hall Law School and is qualified as a Certified Financial Planner (CFP). She is a graduate of the Canadian Securities Institute's Professional Financial Planning Program, a Certified Investment Manager (CIM) and a Fellow of the Canadian Securities Institute (FCSI). An advocate of socially responsible investing, Sucheta is a frequent speaker at community and industry events, and co founder of the blog SRI Monitor. Her website is

Sucheta Rajagopal is an Investment Advisor and Associate Portfolio Manager at Hampton Securities Limited. As an investment professional she manages socially responsible portfolios for individuals, families, not for profit organizations and foundations.

Contact to register for this seminar.

Tuesday, February 22, 2011

Carbon footprint risky for investors, report says

A report prepared for WWF-Canada by Mercer and Trucost concludes that climate change and carbon exposure are new risks for Canadian institutional investment portfolios.

The study found that the TSX has the third-largest carbon footprint among major global indices, second only to the Indian and Emerging Markets indices. “These finding are consistent with resource-based economies that rely heavily on sectors such as oil and gas,” the report states.

The study also found that Canadian pooled funds invested $3.7 billion (US) in 20 energy companies working in the carbon-rich Alberta oil sands, as of the end of 2009. "Funds with larger carbon footprints are likely to be more exposed to greenhouse-gas related investment risks, including regulation, litigation, market and reputational risks.”

“By understanding and managing their carbon exposure, investors can better protect their investments and help fight climate change at the same time,” said Josh Laughren, Director of Climate and Energy for WWF-Canada. “This is an issue that will affect every investment portfolio, and recognizing potential impacts will become increasingly important.”

“Climate change and assessing carbon exposure are becoming important issues for institutional investors – both in terms of potential risk and opportunity,” added Elisabeth Bourqui, head of Responsible Investment Canada for Mercer.

Mercer conducted its analysis using data from Trucost. The report also includes case studies, assessing the carbon risk of the equity portfolio of four Canadian institutional investors: the Toronto Atmospheric Fund, Community Foundation of Ottawa, a public pension plan and Batirente.

The study found that the carbon risk of the Toronto Atmospheric Fund was significantly lower than the benchmark, primarily due to its underweighting in carbon intensive sectors.

Tuesday, February 15, 2011

Ontario Teachers pushes for less frequent say on pay votes

The Ontario Teachers’ Pension Plan, the largest single-profession pension plan in Canada with more than $96 billion in assets, says it does not support annual executive compensation votes.

Instead, Teachers supports such votes every three years, “in keeping with our belief that a properly constituted board, not the shareholder, is best able to address compensation matters in the normal course of fulfilling its responsibilities.”

In a public letter, Teachers says annual votes may compel boards to adjust compensation programs every year to demonstrate that they are effectively managing the compensation process.

“We believe this approach could lead to a focus on short-term objectives rather than on more stable, long-term objectives, or lead to inconsistencies in the compensation program without a clear long-term focus,” the letter states. “In our view, an advisory vote on compensation every three years would remove these biases and better facilitate the development of a compensation program focused on promoting the long-term success of the organization.”

“We believe that an advisory vote on compensation every three years is in keeping with boards designing stable compensation regimes that link compensation, strategy and long-term performance.”

Monday, February 14, 2011

SIO zeros in on barriers to growth

Guest Post By Eugene Ellmen

With an annual budget of less than half a million dollars and a staff of three, the resources of the Social Investment Organization are limited. Yet the needs of the SRI industry are considerable. There is significant retail demand and growing institutional interest SRI, but there is also a stubborn lack of awareness by key gatekeepers. This problem is proving to be a major barrier to industry growth. As the industry’s trade association, the SIO has a mandate to identify these barriers, and to advance solutions to overcome them.

In its most recent annual strategic plan, the SIO Board identifies these barriers in terms of three key stakeholder groups; the public and financial industry stakeholders, the institutional sector and the retail sector.

In terms of institutional stakeholders, the document asserts that “staff and trustees of Canadian pension funds, foundations and endowments have poor awareness of SRI options.”

To address this, SIO launched a pension roundtable in 2010, which is attracting significant membership interest. The SIO also secured funding in 2010 for a development project for an impact investment fund of funds, which has been identified as an important priority for foundations. In the future, SIO will explore the potential for SRI training programs with the foundation sector, as well as supporting the development of responsible investment at university pensions and endowments.

On the retail side, lack of awareness by financial advisors is hobbling sales of SRI funds and retail products. Compounding this problem is unwillingness by advisors to ask their clients about their interest in social or environmental issues. “SIO believes that the financial advisory industry is not providing suitable investments to a large number of clients, many of whom would express a preference for SRI investments if given the opportunity,” states the document.

To meet the need for advisor education, SIO is offering a two-hour face-to-face course for advisors through local Advocis chapters. In the future, SIO will explore the possibility of an online course, as well as other training opportunities through dealerships and brokerages. As well, SIO will explore interest in an SRI specialist certificate program. To enlarge SIO’s base, the organization is considering collaborative activity to reach a much larger body of advisors, which would encourage more advisors to join the SIO and to attend our conferences.

In terms of the public, SIO believes that its resources are best used in reaching out to key public constituencies; namely, the financial industry, the academic community and policy-makers and regulators. The organization made a decision to move to an annual conference in 2009, which has helped to raise the profile of SRI in the financial industry. In addition, SIO will be publishing our key research document – the biennial SRI Review – this spring, and working to increase the depth of its research in future years. Further, research partnerships are underway with the Responsible Investment Initiative at Carleton University and the SRI Cluster of the Canadian Business Ethics Research Network, based at York University. Preliminary discussions are also underway on a research partnership with Royal Roads University in Victoria.

Public policy is also an important priority to help to create a supportive regulatory and legislative agenda for SRI. Efforts will be undertaken to develop public policy projects through SIO’s charitable funding arm – the Fund for Action on Investment Responsibility – as well as collaborative projects with SIO’s sister organizations in other countries.

To reach the broader public, SIO is streamlining its public communications and is moving increasingly into the area of social media and video communication. The organization also recognizes the importance of developing our French language capabilities to serve our members and the public in Quebec.

These strategic priorities are helping the organization to meet the development needs of the industry through partnerships, collaborations and the efficient use of its limited resources.

Eugene Ellmen is executive director of the SIO.

Thursday, February 10, 2011

MSCI to consult on new SRI indices

MSCI has announced that it will consult with the investment community on the creation of potential new global socially responsible indices.

“The proposed indices aim to support the benchmarking and other index related needs of investors who seek to invest in accordance with their values such as religious beliefs, moral standards or ethical views,” MSCI said in a statement. “The proposed indices will exclude companies that are inconsistent with specific values based criteria and will target companies with high ESG ratings relative to their sector peers.”

MSCI already owns nearly two dozen ESG indices run by KLD, picked up when the company purchased KLD parent RiskMetrics last year.

The results of the consultation will be announced on March 4.