Ask Your Advisor About Sustainable Investing

…since our regulations don’t mention it.

Ian Tam, CFA 24 August, 2021 | 1:48AM
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There’s regulatory change in the air. At the end of this year, Client Focused Reforms (CFRs) will hit the ground, and in our opinion will set a higher minimum bar for all advisors in Canada. The changes were designed to ensure that advisors put “client’s interests first” by ensuring proper documentation of your financial situation including your capacity and willingness to take risks, as well as a heavier requirement to understand products that they recommend (including their fees, risk and suitability for your investment style). Despite all this good news, we can’t help but notice that in the sea of regulatory documents surrounding these new changes, phrases like “sustainable investing” or “ESG” are missing.

If the intent of the new regulations is indeed to put the client’s interests first, our opinion is that this should include understanding investor preferences about investing in a sustainable manner.

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About Author

Ian Tam, CFA  is Director of Investment Research at Morningstar Canada. 


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