Part 4 of the Corporate and Community Social Responsibility Research Series

Transcription

1 Ethical Investing Part 4 of the Corporate and Community Social Responsibility Research Series A survey of 1,000 Canadians Conducted from March 24 to 28, 2011 Conducted for: The Corporate and Community Social Responsibility Conference at Algonquin College in Ottawa, Ontario

2 About the Research Series Abacus Data and the Corporate and Community Social Responsibility Conference have partnered to produce a series of public opinion and market research studies on CCSR in Canada. CCSR is a growing area of interest not only for corporations but also for community organizations, social enterprises, consumers, and government. There is a significant amount of research data from American and European sources. The intent of this six-part research series is to gather data from Canadians by Canadians over a 12-month period. It will give us a Canadian perspective on corporate and community social responsibility and allow us to track attitudes and behaviour over time. In October 2010, a benchmark study was conducted and the results released at the CCSR Conference held at Algonquin College in Ottawa on November 16, It examined opinions and behaviour of Canadian consumers towards CCSR. Topic Expected Release Date Canadian Benchmark Survey October 2010 Ethical consumerism January 2011 Ethical employment and compensation February 2011 Ethical Investing April 2011 Individual Social Responsibility August 2011 Canadian Benchmark Survey and Global Comparisons October 2011 ABOUT THE RESEARCH SERIES For more information about this series, please contact David Coletto at david@abacusdata.ca

3 Summary The most recent CCSR study conducted by Abacus Data finds that there is a significant market for ethical investments in Canada. Many Canadians say they consider the impact their investments have on their community and the environment and about one in ten have even changed their portfolio to remove investments they consider socially irresponsible. Although most Canadians cite their return on investment as their top concern, the market for ethical investments is significant, particularly among women and older Canadians. These ethical investors are more likely to choose investments that are socially responsible, even if there is a lower financial return on investment. Moreover, this study found that local concerns trump national or even international issues when Canadians consider where they would like to see positive social or environmental impacts. This suggests that corporations and organizations seeking develop CSR strategies should focus on the impact their programs have on local communities. KEY FINDINGS Finally, the results of this study suggest that a focus on environmental issues is not sufficient in a CSR strategy. Canadians were more likely to prefer to see positive impacts in affordable housing, education and training, and hunger reduction, than in environmental causes or public transportation. Key Findings There is a large market in Canada for socially responsible investing. (page 7) 26% consider the whether their investments are socially responsible before investing 24% monitor their investment portfolio to ensure it is socially responsible, but rarely change it. 7% have changed their portfolio to remove investments that are not socially responsible. When presented with three portfolios with differing characteristics, Canadians we surveyed were more likely to prefer a portfolio a with lower return but it hat s more socially responsible. (page 9) Local investment trumps international investment. (page 13) When asked to distribute $1,000 to organizations that can have a positive impact, respondents were most likely to want to see the impact occur in their local community followed by their municipality. Impact in a foreign country was least important by way of the amount respondents would invest. Housing and education trump the environment and transportation on preferred issue for impact. When asked to rank a number of issues according to which they would like to see their investment impact, respondents ranked affordable housing and education higher than the environment and public transportation (page 14).

4 Convenient location or ATMs Reputation of the institution Online services Comprehensive service offering Lower service fees Recommended by friends or family Better interest rates 13% 22% 16% 30% Why do you bank with your type of financial institution? Check all that apply (n=999, weighted) 52% 47% 68% 0% 20% 40% 60% 80% Subgroup A majority of Canadians do business with their dayto-day bank because of its convenient location or ATMs (68%) or its reputation (52%). Access to online services was also seen as an important factor in selecting a bank. It is interesting to note that users of different types of banks have differing priorities regarding why they chose that financial institution. For instance, Canadians who use chartered banks and credit unions do so primarily because of convenience and reputation, whereas the top reasons for citizens banking with an international, virtual, or internetbased bank were better interest rates, lower service fees, and online services. PERSONAL BANKING Chartered Banks International Banks Virtual Banks Internet-based Banks Credit Unions Convenient location or ATMs 73% 29% 31% 38% 62% Recommended by friends or family 15% 29% 12% 25% 20% Better interest rates 9% 43% 40% 50% 17% Lower service fees 13% 25% 88% 38% 36% Online services 13% 25% 88% 38% 36% Reputation of the institution 53% 29% 15% 25% 59% Comprehensive service offering 32% 14% 17% 25% 26%

5 No, 35% Do hold any investments such as RRSPs, Stocks, Real Estate, Mutual Funds, Bonds, or Commodities? (n=999, weighted) Yes, 65% Most Canadians (65%) have some type of investment, such as stocks, bonds, RRSPs, real estate, etc. Not surprisingly, as age and education increase so does the likelihood of holding an investment. Results varied by region, with Central Canadians the most likely to have investments (78%) and Atlantic Canadians the least likely (54%). An equal amount of men and women hold investments. INVESTMENT BANKING Subgroup Male Female BC Alberta Central Ontario Quebec Atlantic Yes 66% 64% 38% 68% 80% 64% 72% 78% 66% 61% 54% No 34% 36% 63% 32% 20% 36% 28% 22% 35% 39% 46% Unweighted Count Weighted Count

6 Thinking about your own investment portfolio, do you do any of the following: Check all that apply (n=1000, weighted) I only care about increasing the return on my investments, and don't consider the social or environmental impact of my portfolio. Before investing in a company, mutual fund, or other investment instrument, I consider whether it is a socially responsible investment. I monitor my portfolio regularly to ensure that my investments are socially responsible, but I rarely revise my investment strategy. 26% 24% 49% ETHICAL INVESTING I have changed my portfolio to remove investments that are not socially responsible. I am a shareholder activist I buy shares in companies to influence their business decisions to make them more socially responsible. 3% 7% 0% 10% 20% 30% 40% 50% 60% When asked to select which statements represented their behaviour regarding investments, almost half of respondents (49%) said they don t consider the social or environmental impact of their portfolio; their primary concern is the return on investment. One quarter of respondents said they consider the social responsibility aspect of their investments although another 24% said they rarely revise their investment strategy. Only a small percentage of Canadians are very active in ensuring their investments are socially responsible. On the whole, there were similar results across all demographic groups, with a few exceptions. Before investing, women were more likely than men to take into account whether the investment is socially responsible (women 33%, men 20%) as were British Columbians (32%) compared to residents of Central Canada (20%). Men were more likely to only care about increasing the return on investment (57%) than women (42%).

7 Consider the following three possible investment scenarios. Pretend you have $1,000 to invest in one of the three portfolios below for a one year period. Tell us which portfolio you would most likely invest in. (n=1000, weighted) CEO Compensation (ratio of CEO to lowest paid employee) Portfolio 1 (Most Ethical) Portfolio 2 (Balanced) Portfolio 3 (Least Ethical) Low Reasonable High Environmental record Very good Mixed Poor Labour practices Very good Very good Very good Operating in countries with oppressive regimes No Yes Yes Direct community investment High High Low ETHICAL INVESTING Community involvement Yes Yes Yes Reporting Transparency Good Good Good Amount of additional money you will receive at the end of the year $50 $100 $180

8 Consider the following three possible investment scenarios. Pretend you have $1,000 to invest in one of the three portfolios below for a one year period. Tell us which portfolio you would most likely invest in. (n=1000, weighted) Portfolio 2, 41% Portfolio 3, 13% Portfolio 1, 46% We asked respondents to review three types of portfolios: one that was more ethical with a lower return (Portfolio 1), one with lower ethics and a higher return (Portfolio 3), and another balanced between the two (Portfolio 2). Overall, Canadians were fairly split between Portfolio 1 (41%) and Portfolio 2 (46%), with slightly more Canadians choosing the balanced investment option. Only 13% chose more money over less ethical behavior. ETHICAL INVESTING Women were more likely to choose Portfolio 1 than men (46%, 35%, respectively) whereas men were more likely to choose Portfolio 3 than women (19%, 8%, respectively). Canadians 60 years and older were the most likely to choose Portfolio 1. Subgroup Male Female Portfolio 1 35% 46% 37% 39% 46% Portfolio 2 46% 47% 50% 47% 42% Portfolio 3 19% 8% 13% 14% 13% Unweighted Count Weighted Count

9 Why did you select Portfolio 1? (n=1000, weighted) ETHICAL INVESTING The key reasons that emerged for respondents who selected Portfolio 1 were lower CEO compensation, no operations in countries with oppressive regimes, and the sense that it most aligned with the respondents values. Portfolio 1 was also seen to be the most socially responsible.

10 Why did you select Portfolio 2? (n=1000, weighted) ETHICAL INVESTING Many people who chose Portfolio 2 said they did so because it seemed reasonable and was a good balance between the return on investment and social responsibility.

11 Why did you select Portfolio 3? (n=1000, weighted) ETHICAL INVESTING The main reason almost everyone who selected Portfolio 3 gave was that it gave the best return and that the point of investing is to make money.

12 Imagine you are given the ability to decide where to give $1,000 (not your money) in an organization that is working to improve the lives of people. Distribute the $1,000 based on where you want the money to have an impact. (n=1000, weighted) $ Amount (avg) Your neighbourhood $ Your municipality $ Your province $ On average, Canadians want more money going to improve the lives of people in their neighbourhood compared with those further removed. The average dollar amount was highest for the most local impact and decreased as the impact spread outward. Generally, there was no significant difference between men and women, with the exception giving for a foreign country where, on average, women choose to give more money than men. DONATIONS Canada $ A foreign country $ Canadians older than 60 years wanted more money spent on their municipality compared to respondents years old, whereas the younger cohort distributed more money to a foreign country. Your neighbourhood Your municipality Subgroup (Average Dollar Amount) Male Female BC Alberta Central Ontario Quebec Atlantic $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ Your province $ $ $ $ $ $ $ $ $ $ $ Canada $ $ $ $ $ $ $ $ $ $ $ A foreign country Unweighted Count Regionally, the biggest difference was the high average amount ($416) that Quebecers distributed to their neighbourhood, compared to the other provinces. $99.07 $ $ $ $ $ $ $ $ $ $ Weighted Count

13 What cause would you want that donation of $1,000 to impact? Rank from most important to least important. (n=1000, weighted) Importance (average rank) Affordable housing 2.8 Education and skills development 2.9 Reduce hunger 3 A small business that helps the community Environmental cause 4.1 Public transportation Respondents were given six causes to rank from most to least important. In calculating the average rank the lower the number the more important it is. According to Canadians, their top three causes are affordable housing, education and skills development, and reducing hunger. There was very little difference in rankings across all demographic groups. The only significant difference is among the regions on the environment and education. Quebecers rank the environment higher than the rest of the provinces, especially Alberta, whereas Albertans rank education and skills development the highest. DONATIONS Subgroup (Average Rank) Male Female BC Alberta Central Ontario Quebec Atlantic Affordable housing Education and skills development Reduce hunger A small business that helps the community Environmental cause Public transportation Unweighted Count Weighted Count

14 Say you already decided to make an investment of $1000 of your own money in a social cause. The organizations will give you a financial return on your investment. Which of the following two options are you most likely to go with? (n=1000, weighted) A cause you believe in but are not passionate about and the return on your investment is high, 41% A cause you believe in and are passionate about but the return on your investment (money back to you) is low, 59% About six in ten Canadians (59%) prefer to invest in a cause they believe in and are passionate about but with a low return than a cause with high return, but something they are not passionate about. Women and Canadians over 60 years were the most likely to invest where they received a lower return, but the cause was something they are passionate about. DONATIONS Subgroup Male Female A cause you believe in and are passionate about but the return on your investment (money back to you) is low A cause you believe in but are not passionate about and the return on your investment is high Unweighted Count 52% 67% 59% 58% 63% 49% 33% 41% 43% 37% Weighted Count

15 Survey Methodology From March 24 th to March 28 th, 2011, Abacus Data Inc. conducted an online survey among 1,000 randomly selected Canadian adults from an online panel of over 100,000 Canadians. The margin of error which measures sampling variability is comparable to +/- 3.2%, 19 times out of 20. Results of the survey were statistically weighted by gender, age, region, language, and immigration status using census data from Statistics Canada and by past vote using Elections Canada results from the 2008 General Election. Totals may not add up to 100 due to rounding. For more information about the poll s methodology, visit the Abacus website at METHODOLOGY The table below reports the unweighted and weighted distribution by region or province. Region/Province Unweighted Count (All Respondents) Weighted Count (All respondents) Atlantic Canada Quebec Ontario Prairies (MB and SK) Alberta BC Total 1,

16 Abacus Data Inc. is Canada s newest player in the public opinion and marketing research industry. Whether it s telephone or online surveys, focus groups, one-on-one interviews, or secondary data analysis, the team at Abacus Data conducts public opinion, marketing, or stakeholder research that provides strategic insight to our clients. What sets the team at Abacus Data apart is its fresh perspective on politics, business, and consumer behaviour and a commitment to its clients. Abacus Data offers its clients a comprehensive research tool kit that includes: Custom quantitative studies Opinion leader/decision maker consultations The Vertex Panel ( Omnibus surveys Focus groups Intercept studies One-on-one interviews Custom community panel creation and management Secondary data analysis Abacus Data also runs the Vertex Panel: An online research panel of Canada s leading public policy practitioners and scholars. Dr. David Coletto, CEO Coletto has over six years experience working in the marketing research industry. He has conducted research studies for organizations in many sectors including pharmaceutical, transportation, educational, telecommunications, media, arts and cultural, tourism, and retail. He has also advised elected officials and seniorlevel decision makers at the federal, provincial, and municipal government levels. ABOUT ABACUS DATA Find out more at Sparks St., Suite 1090 Ottawa, ON K1P 5B7 (613) He received his PhD in Political Science from the University of Calgary where he taught Research Methods to undergraduate students.

17 About the CCSR Conference The third annual Corporate and Community Social Responsibility conference was held on Tuesday, November 16th, 2010 at Algonquin College in Ottawa to celebrate and showcased excellence in CCSR. This year's theme was Achieving Social Innovation through Corporate and Community Collaboration. Participants engaged with experts from around the country and learned new ways corporations are working with the community and NGOs and how such relationships improve productivity and enhance the bottom line. Corporations learned about best practices and how cross-sectoral partnerships enable employees of both NGOs and corporations to better utilize their collective assets to support community building as well as social and business innovation Award Sponsorship Gold Sponsorship Silver Sponsorship For more information about the conference, visit ABOUT THE CCSR CONFERENCE Bronze Sponsorship

18 For more information about this study or the series please contact: David Coletto, PhD Chief Executive Officer (613) x. 248 Twitter.com/ColettoD GET INTOUCH Eli Fathi Chair Corporate and Community Social Responsibility Conference (613) , ext. 222 Twitter.com/oiqeli To read our analyses and blog, find us online at