Canadian credit union guarantees responsible investment

A Canadian credit union has become the country’s first financial institution to offer socially responsible guaranteed investment (SRI) certificates. Mennonite Savings and Credit Union (MSCU) based in Ontario...

A Canadian credit union has become the country’s first financial institution to offer socially responsible guaranteed investment (SRI) certificates.

Mennonite Savings and Credit Union (MSCU) based in Ontario has developed a set of socially responsible lending criteria to incorporate into its agricultural and commercial lending practices.

MSCU provides banking services to 20,000 members, has more than CAD $950m in assets and is one of Canada’s ten largest credit unions.

“We are thrilled to be a leader in SRI,” said Brent Zorgdrager, chief executive of MSCU. “Our commitment to our members is to continue to look for ways to offer values-based products that connect faith and values with finances, inspiring peaceful, just, and prosperous communities.”

Criteria include screening business borrowers for involvement in industries such as tobacco, alcohol and gambling as well as negative impacts on the environment, human rights or communities.

Sustainalytics, which delivers environmental, social, governance and corporate governance ratings, has carried out a review of MSCU’s loan portfolio.

“MSCU’s socially responsible GICs address a growing demand among individual investors considering the environmental and social impacts of their investments,” said Sustainalytics’ chief executive, Michael Jantzi. “MSCU has embedded socially responsible criteria into its lending processes in an innovative way.”

Figures from the Responsible Investment Association (RIA) showed that responsible investment accounts for more than 30% of Canadian assets under management.

Deb Abbey, RIA’s chief executive, explained: “Many financial institutions, including MSCU, have offered responsible investment options but MSCU is leading the way by integrating environmental and social factors into all of their GICs. We’re very excited to see them take this initiative.”

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