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 31 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
Globally, Great-West Lifeco paid over $32 billion to customers in 2018. Great-West Lifeco’s Canadian companies helped families cope with loss, paying out more than $2.5 billion in life insurance benefits in 2018 and providing income for over 79,000 people who became disabled and could no longer work. It also helped over 30,000 employers provide benefits plans and 9,100 employers offer retirement savings plans to their employees. They also paid $9.3 billion in benefits and made $916 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.
IGM Financial believes that the help of a financial advisor makes a difference for Canadians in all age groups and income levels – including those in lower income ranges who were not financially secure when they sought help from an advisor.
Under the banner of IG Empower Your Tomorrow, IG Wealth Management’s sponsorship and community platform is designed to increase the financial confidence of Canadians in communities from coast to coast, aligning it with the company’s overall vision of “inspiring financial confidence in Canadians.” The platform focuses on building the financial confidence of those who stand to benefit the most from it – youth, seniors, new Canadians, and Indigenous Peoples. Tailored financial knowledge and resources are delivered to these groups through strategic community partnerships. As an example, 50 financial literacy workshops were delivered to over 1,300 seniors and Canadian newcomers through the Canadian Foundation for Economic Education/IG Wealth Management workshop series.
Great-West Lifeco was the first in Canada to announce a new flexible savings pilot program to help 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. In 2018, the company was pleased to welcome Indigo as the first national employer in Canada to offer this program to their employees.
Great-West Lifeco continues to embrace technology and social media to reach Canadians with educational tools that can help them understand the benefits of retirement savings plans. While continuing to leverage its smartpathnow.com website to offer free online learning for all stages of savings and retirement planning through games, calculators, videos and text-based learning about personal financial planning, Great-West is also piloting a new, goals-based investing tool that advisors can use with their customers to help ensure investments align with the individual’s financial and lifestyle goals. Working with an advisor, clients will be able to benchmark and monitor the progress of their overall investment plan, specifically with regards to the targeted level of return and corresponding risk they need to be willing to accept, on average, to achieve their goals. A digital client portal will also be available, providing customers with easy-to-understand, real-time reporting on their portfolio’s performance and their progress towards their financial goals.
Great-West Lifeco also offers product solutions to meet the needs of workers who do not have registered retirement savings plans.
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.
For Great-West Lifeco’s Canadian operations, 2018 marked its fifth year of commitment as the national sponsor of the Chartered Professional Accountants (CPA) of Canada’s suite of outreach educational programs that are helping meet the financial literacy needs of community organizations, underserved groups like new Canadians and Indigenous Peoples, post-secondary students and individuals of all ages. Since becoming the national program sponsor in 2014, Great-West Lifeco has provided almost $1 million in support to the charitable program. In 2018, CPA Canada reported that more than 75,000 Canadians accessed digital resources and 2,280 no-fee workshops in 35 financial literacy programs, including five new ones. Examples of the program’s initiatives include school programs to teach students basic concepts and skills through interactive activities and case studies, or a community session helping seniors to better manage their finances in retirement and protect themselves against fraud.
IGM Financial demonstrates its commitment to financial confidence through the activities of IG Wealth Management, which since 1995 has contributed more than $4.1 million to support and promote financial literacy programs for Canadians.
IG Wealth Management’s ongoing collaboration with the Canadian Foundation for Economic Education (CFEE) continued to make a real contribution in 2018 to improving financial literacy of youth and their parents. The company still supports 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 aimed at high school students and produced by CFEE with funding from IG Wealth Management. Money and Youth was also made available as an e-book for increased accessibility. With support from IG Wealth Management, more than 500,000 copies are in circulation in schools and households, helping to improve the financial literacy of Canadian youth. It also supported new courses as they were developed for the high school level, including lesson plans and workshops for teacher professional development.
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 2018, the company funded more than $3.5 billion in new private debt and commercial mortgages across Canada.
Great-West Lifeco is also a founding investor of the newly launched 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.
Through its subsidiaries GLC Asset Management and Putnam, Great-West Lifeco also provides a suite of investment offerings, including socially responsible investing mandates, giving clients a meaningful way to help ensure their investments promote a higher level of environmental sustainability, social responsibility, and corporate governance.