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.