Financial Well-Being and Economic Prosperity
Financial services, the mainstay of our business, make a positive contribution to society by providing financial security to virtually millions of people. Our group companies protect and improve the long-term financial position of individuals and offer programs to help them manage their healthcare needs. By the very nature of our group companies, our activities are aligned with the Sustainable Development Goals and create social and economic prosperity.
With more than 32 million customer relationships globally, our financial services companies represent a positive force in society by enabling financial security through life and health insurance, retirement savings programs, and a suite of investment products.
A 2016 report released by the Center for Interuniversity Research and Analysis of Organizations (CIRANO), The Gamma Factor and the Value of Financial Advice, found that investors who work with a financial advisor have a higher savings rate on average than those who do not. For example, over a 15-year period, households working with an advisor had 3.9 times the assets of a household without a financial advisor. The study highlights the value advisors add by encouraging more disciplined saving and investment behaviour.
Having the knowledge, skills and confidence to make informed financial decisions is critical to the financial well-being of our clients. Through the innovative products and services provided by our operating subsidiaries Great-West Lifeco and IGM Financial, and by the fintech companies in which we invest, such as Wealthsimple, we are helping clients of all backgrounds plan for their long-term financial security and success.
Highlights from our Group Companies
Financial Security and Retirement
In 2019, Great-West Lifeco paid over $37 billion in benefits to customers globally, including $9.7 billion in Canada. Great-West Lifeco’s Canadian insurance companies helped families cope with loss, paying out more than $2.5 billion in life insurance benefits in 2019 and providing income for over 79,500 people who became disabled and could no longer work. Their participating life insurance products delivered over $1 billion of policyholder dividends. They also helped approximately 30,000 employers provide benefits plans and more than 9,000 employers offer retirement savings plans to their employees. In addition, they made $909 million of annuity payments, helping Canadians fund their retirement with a secure income stream.
As investment managers, IGM Financial’s group companies contribute to the economy through the efficient allocation and professional management of investment funds – across countries, industries and asset classes. Their largest impact comes from responsibly managing their business and generating long-term value and profitability, which enables them to distribute economic value to their many shareholders and other stakeholders in Canada. Through its advisors, IGM Financial helps Canadians build an integrated financial plan to meet their short- and long-term goals. Financial advisors are trained to recommend products that are suitable for each client’s individual situation. They continue to evolve their products, services, support, and training so that their advisors can continue to enhance the financial well-being of their clients.
As a financial services company, IGM Financial believes that one of the best ways to strengthen communities is by offering resources and expertise to help Canadians feel confident about their finances, so they can achieve their goals and own their financial future.
IG Empower your Tomorrow focuses on assisting four key groups who are underserved when it comes to financial guidance: Indigenous peoples, newcomers, seniors and youth. This platform is brought to life through IG Wealth Management consultants, national partnerships, community seminars, events and educational materials. For instance, partnerships with organizations like Opportunities for Employment help to provide financial education and job training to Indigenous peoples. Also, knowing that learning the financial systems of a new country can be daunting, IGM Financial works with the Canadian Foundation of Economic Education (CFEE) to provide financial education in newcomers’ first language. As another example, a total of 50 CFEE/IG Wealth Management financial literacy workshops were delivered to nearly 1,000 seniors and newcomers, with IG Wealth Management consultants participating in about 60 per cent of them.
Canada Life’s flexible savings pilot program helps post-secondary graduate plan members focus on saving for the future while paying down their student loan debt. This program is aimed at reducing this financial obstacle, which often causes many to delay saving for retirement. It allows employers to match the member’s student loan repayment with a corresponding contribution to their group retirement and savings plan. Indigo was the first Canadian national employer to offer this program. The program has since expanded with positive results: one sponsor increased group retirement savings plan participation by 11 per cent. The program continues to expand today.
Canada Life collaborated with Canadian author Robert Brown to develop an educational program for plan members based on his acclaimed bestseller, Wealthing like Rabbits: An Original and Occasionally Hilarious Introduction to the World of Personal Finance. It teaches beginner savers the advantages of starting to save early and compound interest. The tongue-in-cheek tone and playful graphics make it easy to learn important financial concepts.
As a way to increasing access to workplace health benefits, Canada Life also launched Flexbox™, a solution for small business employers that helps increase the accessibility of employee group health benefits and taps a broader spectrum of previously underserved customers. Using a self-serve digital platform, employers can learn about group benefits at their convenience, and design a plan tailored to their budget and needs.
Our group companies’ commitment to improving financial literacy also represents a means to further expand their positive impact on the financial security of their clients.
Canada Life is the national development sponsor of the Chartered Professional Accountants of Canada (CPA Canada)’s award-winning financial literacy program, which empowers Canadians, from children to seniors, with the knowledge to make informed decisions and achieve their goals. Since becoming the Financial Literacy Program National Development Sponsor in 2014, the company has provided almost $1 million in support, which has helped CPA Canada build a strong volunteer network with in-person workshops and digital training and resources. It also helped the program double its educational resources to span nearly 50 relevant and emerging topics, including the Stretching Your Dollar series, catering to low-to-moderate income Canadians, and a program offering financial advice after a job loss, among many others. The program draws upon the knowledge and expertise of more than 6,700 passionate CPA volunteers to deliver objective and free sessions across Canada with programming specifically designed for seniors, adolescents, parents, new Canadians, not-for-profits, students, entrepreneurs and remote communities. In 2019 alone, over 2,000 sessions were held with 50,000 Canadians attending workshops and more than 126,000 people accessing digital resources.
In addition, Canada Life presented the 2019 CPA Canada annual financial literacy conference, Mastering Money, during which financial leaders came together to discuss everything from behavioural economics to best practices in Indigenous communities, and how those issues are shaping financial literacy.
IG Wealth Management’s ongoing collaboration with the Canadian Foundation for Economic Education (CFEE) continued to make a real contribution in 2019 to improving financial literacy of youth and their parents. The company continued to support CFEE’s Building Futures program, which helps provinces integrate financial education into the core curriculum for grades 4 to 10. Building Futures leverages the popular guidebook Money and Youth: A Guide to Financial Literacy. With support from IG Wealth Management, more than 500,000 copies were distributed free to students, parents and educators across the nation and thousands of students attended workshops. In the fall of 2019, the Money and Youth financial literacy textbook and website were updated and re-launched. They reached more than 43,000 high school students across Canada. In addition, textbook usage by IG Wealth Management consultants totalled approximately 6,300, a 96 per cent increase over 2018.
Investments to Spur Growth
Through its investment activities, Great-West Lifeco provides long-term capital, contributing to economic growth, and helping Canadians reach their financial goals. The company’s commercial mortgages, public bond and private placement investments provide opportunities for businesses and governments to help create employment, fund research and development, and support infrastructure, healthcare and renewable energy projects. In 2019, the company funded more than $2.4 billion in new private debt and commercial mortgages across Canada.
Canada Life is also a founding investor of the Canadian Business Growth Fund aimed at fostering innovation. Funded by Canada’s leading banks and insurance companies, the Fund will invest in Canadian entrepreneurs and provide businesses with the capital they need to grow domestically and globally. An advisory network has also been created to provide mentorship to help these businesses to achieve their full growth potential and write the next generation of Canadian business success stories.