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. In short, 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 30 million customer relationships in Canada, the United States and Europe, 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 Canadians. 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 Canadians of all horizons plan for their long-term financial security.
Highlights from our Group Companies
Financial Security and Retirement
In 2017 alone, Great-West Lifeco’s Canadian operations helped families cope with loss, paying out more than $2.4 billion in life insurance benefits and provided income for over 78,000 people who became disabled and could no longer work. It also helped over 30,000 employers provide benefits plans and 9,000 employers offer retirement savings plans for their employees. In 2017, Great-West Life held $109 billion in retirement and other investment holdings for Canadians, paid $9.4 billion in benefits and 58 million health and dental claims representing more than $4.8 billion in health and dental benefits for plan members. It also made $858 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. IGM Financial also provides mutual fund solutions at very low investment minimums, making it possible to provide much-needed access to financial products and services to all households, regardless of income or wealth levels. For example, through Solutions BankingTM, IGM Financial offers no-fee chequing accounts for youth and reduced fees for seniors. Investors Group sponsorship and community engagement strategy was recently reshaped to focus on improving the financial confidence of youth, Indigenous peoples, new Canadians and seniors. In addition, in 2018, Investors Group also launched a centralized National Service Centre, designed to provide full account servicing and financial planning by licensed financial representatives to clients with lower account sizes.
In 2017, Great-West Lifeco became 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 2017, Great-West Life continued 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 also launched their WayfinderTM tool, a simplified online financial wellness tool for their group retirement plan members to see a consolidated view of all of their retirement savings.
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.
Ensuring all Canadians, including community organizations, underserved groups like new Canadians and Indigenous Peoples, post-secondary students, have access to information that helps them make informed financial decisions means stronger communities. This is why since 2014, Great-West Lifeco is the national sponsor of CPA Canada’s financial literacy program, one of the largest and most trusted in Canada, with a growing array of programming and resources that offer Canadians free financial workshops delivered by volunteer CPAs and access to a number of award-winning publications and online resources. In 2017, these volunteers provided objective, easy to understand information sessions on 35 topics to 50,000 Canadians. 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.
Investors Group’s ongoing collaboration with the Canadian Foundation for Economic Education (CFEE) continued to make a real contribution in 2017 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. It also supported new courses as they were developed for the high school level, including lesson plans and workshops for teacher professional development. Building Futures leverages the popular guidebook Money and Youth: A Guide to Financial Literacy for high school students produced by CFEE with funding from Investors Group. Money and Youth was also made available as an e-book for increased accessibility. With support from Investors Group, more than 500,000 copies are in circulation to schools and households, helping to improve the financial literacy of Canadian youth. Investors Group has contributed $3.7 million since 1995 to support and promote financial literacy programs for Canadian children and teens.
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 2017, the company funded more than $3.0 billion in new private debt and commercial mortgages across Canada.
Along with other major banks and insurance companies, Great-West Lifeco announced, in October 2017, the creation of the Canadian Business Growth Fund to foster innovation through investments in small- and medium-sized Canadian companies seeking long-term, patient and minority capital to finance continued growth. The fund will facilitate mentorship and access to talent pools and help these businesses achieve their full potential. It will also establish an advisory network to provide mentorship to help close some of the knowledge gaps preventing many mid-sized companies from achieving their full growth potential at home and globally.
Through its subsidiary GLC Asset Management, 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.