Responsible investments account for 71 per cent of the total assets under management by Canadian institutional investors, according to a new report from the Responsible Investment Association.
The report, which is based on a survey of Canadian institutional asset managers and asset owners completed between May and July 2024, found the total assets attributable to responsible investment totalled $4.5 trillion.
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More than half (58 per cent) of respondents said they have confidence in the quality of environmental, social and governance reporting. However, it noted further standardization in disclosure is needed to improve confidence and unlock the value of responsible investing in decision-making.
Indeed, concerns surrounding greenwashing tactics, disclosures and data quality have subsided while worries around perceived performance of responsible investing assets are more pronounced, the report said.
Half of respondents said they expect to see moderate growth for Canadian responsible investments over the next two years. The report also found 91 per cent of each organization’s total responsible investment AUM is dictated by ESG integration as a strategy.
More than three in 10 respondents said younger people, either investors or plan members, are a key driver for the growth of responsible investments.
In a press release, Patricia Fletcher, chief executive officer at the RIA, said responsible investing is continuing to evolve at the institutional level but investors can’t become complacent. “Collective action and advocacy are necessary to further advance the adoption of [responsible investing] and mobilize capital to strengthen Canada’s economic resilience.”
Read: Canadian sustainability investment standards to launch in December