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Ethical screening – Second only to U.S.

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Socially responsible investment in Canada has grown to $50 billion, giving Canada the second-largest retail social-investment industry in the world, a new study says.

Ethical investment accounts for 3.2 percent of the retail mutual fund market and the institutional investment market, says the study by the Social Investment Organization, a national nonprofit dedicated to the advancement of socially responsible investment.

Screened mutual funds and socially responsible labor funds grew 75 percent to $10.35 billion in June 2000 from $5.9 billion in June 1998 – more than twice the growth rate of the mutual fund industry as a whole.

Only the U.S. has a larger retail social investment industry.

The survey, conducted between July and November, is the first comprehensive look at social investment in Canada. It surveyed investment management firms, institutional investors and community investment providers.

Other social investment assets reported in the study include:

* $11.3 bilion managed by investment management firms on behalf of institutional clients asking for social or environmental screening.

* $27.2 billion with institutional investors managing funds mainly or wholly in-house.

* $1 billion in shareholder advocacy initiatives on social and environmental issues.

* $85 million in investments by locally-based community investment groups.

The study was sponsored by two founding members of the Social Investment Organization – Ethical Funds Inc. and VanCity, and was conducted in conjunction with the MBA program at Wilfrid Laurier University.

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