RBC announced on July 27 the launch of two new GICs, one of which is based on Environmental, Social and Governance factors (ESG).

The new GICs are the RBC ESG Market-Linked GIC and the RBC North American MarketSmart GIC. They were developed through a partnership between RBC Capital Markets and the GIC business within the retail bank. 

The RBC ESG Market-Linked GIC is aimed at investors who want to include ESG considerations in their investment decisions, says the bank. The ESG GIC is linked to a global index of environmentally and socially responsible organizations, all of which must first pass a set of ESG standards. To be included, each company must demonstrate positive ESG metrics, low carbon impact and strong financial health, says the bank. 

The RBC North American MarketSmart GIC tracks the performance of a customized basket of stocks in 20 North American companies, such as Bell, Coca-Cola, Pfizer, Johnson & Johnson, Canada's Big Five banks and McDonald's. 

"We know investors are looking for higher yields – particularly in a low interest rate environment – while minimizing risk. Both of these new GICs help make that possible," says Flora Do, Vice-President, Term Investments & Savings, RBC. "In recent years, we've also seen a growing focus on looking beyond a company's balance sheet when making investment decisions. ESG investing is a strategy for anyone who values the added layers of analysis when it comes to assessing a company's outlook and wants to take ESG factors into account when making their investment decisions." 

As with traditional GICs, an investor's initial investment in these two new products is 100% guaranteed. Unlike traditional GICs, both are linked to market performance, offering investors potential gains from stock market returns.