Socially Responsible Investing (SRI)
Investing responsibly doesn’t have to come at the expense of financial returns
IA Clarington Inhance SRI Funds, managed by SRI pioneers Vancity Investment Management Ltd. (VCIM), can help grow your wealth in a way that aligns with your personal values. VCIM uses a three-pronged approach to investing responsibly:
- Environmental, social and governance (ESG) screening
- Financial analysis
- Shareholder engagement
To identify potential investments for IA Clarington Inhance SRI Funds, VCIM’s portfolio managers assess companies based on seven main ESG criteria:
- Corporate governance
- Environmental leadership
- Employee relations
- Employee diversity
- Community relations
- Human rights practices
- Product sustainability
VCIM does not invest in companies whose primary line of business involves:
Importantly, VCIM’s assessment process involves more than just screening out companies that fall short of its ESG criteria. The portfolio managers actively screen in companies that demonstrate a firm commitment to progressive social values and environmental stewardship.
As of October 2019, all IA Clarington Inhance SRI Funds are fossil fuel free. This means the Funds do not invest in:
- Oil, gas and coal producers
- Pipeline companies
- Natural gas distribution utilities
- Liquefied natural gas operations
VCIM’s security selection specialists assess potential candidates for the Funds based on a wide range of fundamental financial metrics, including:
- Free cash flow
- Price-to-earnings ratio
- Earnings growth
- Return on equity
Portfolio managers also assess companies’ business models, competitive advantages and quality of management.
Only securities that satisfy the stringent requirements of both the ESG team and the financial analysis team are eligible for inclusion in IA Clarington Inhance SRI Funds.
VCIM implements a robust ESG monitoring and shareholder engagement strategy. All holdings are continuously monitored to ensure they maintain the high ESG standards that initially qualified them for inclusion in the fund. When companies appear to deviate from these standards, the VCIM team actively engages with management, either one-on-one or in concert with other shareholders or stakeholders.
VCIM also actively engages industry leaders to encourage them to elevate their commitment to ESG. The goal is to create a positive ripple effect across the broader industry.
IA Clarington Inhance SRI Funds
IA Clarington Inhance SRI Funds consist of a variety of standalone mutual funds and all-in-one portfolio solutions: