Adoption may have softened but there is still demand for responsible investing
With the Trump administration having fuelled a significant pullback in investment in ESG initiatives in the US, which has spilled over into Canadian and other international markets, some would consider that this is a barren land for advisory business.
But despite a cooling in the pace of adoption, interest in responsible investment still remains strong, providing a frequently untapped opportunity for advisors, according to a new report.
The newly-released research from the Responsible Investment Association (RIA) indicates that advisors who are fully committed maintain steady usage, while many clients seek RI services that their advisors may not yet offer.
The 2025 RIA Advisor RI Insights Study, based on a survey of 300 Canadian retail investment advisors, shows that adoption of RI has retreated to 64 % in 2025 from 73 % in 2023, suggesting fewer new entrants into RI strategies.
However, for those advisors already integrating RI into their practices, the level of commitment has not wavered. These advisors consistently allocate about 13 % of their assets under management to RI portfolios, mirroring prior years.
And the growth outlook is cautiously optimistic with 75 % of advisors expecting RI to expand over the next two years, though this optimism is less intense than observed in earlier cycles.
The survey reveals that clients often initiate conversations about RI, rather than advisors, suggesting a “service gap,” but one lever to narrow that gap is structural with almost half of advisors who took part favouring embedding RI-related questions into the Know Your Client (KYC) process.
"While adoption has steadied, investor demand for RI remains strong and advisors remain open to closing the service gap," says Patricia Fletcher, CEO of the RIA. "Mobilizing wholesalers and equipping advisors with tools and training, we can empower advisors to align portfolios with their clients' values."
Wholesalers still play a pivotal role as the main conduit of RI education and information for both advisors already using RI and those not yet engaged.
