With its official public launch on Wednesday, Vancouver-based robo-advisor ModernAdvisor hopes to appeal to environmental-conscious Millennial and Gen X clients with responsible investing (RI) portfolios.

“[These clients] are asking for [these options] and it’s something that we also believe in,” says Navid Boostani, CEO and founder of ModernAdvisor, which was first available to a small group of investors in October 2015 as part of a beta program. “If people can invest for their future and also feel good doing it, it’s a win-win.”

This is the first time a Canadian robo-advisor has offered investors an exclusively RI portfolio option, according to ModernAdvisor.

Although RI is a focus for ModernAdvisor, investors are not limited to these funds. During the sign-up process, investors will be asked whether they wish to invest in an RI portfolio or if they simply want the lowest-cost portfolio.

Those who select the RI option will be placed in portfolios consisting of five exchange-traded funds (ETF) that meet environmental, social and governance (ESG) criteria and have exposure to North American and emerging markets.

ModernAdvisor’s RI portfolio options include: iShares Jantzi Social Index ETF, iShares MSCI KLD 400 Social ETF, iShares 1-5 Year Laddered Government Bond Index ETF, BMO Emerging Markets Bond Hedged to CAD Index ETF and Vanguard FTSE Canadian Capped REIT Index ETF.

Although Vanguard FTSE Canadian Capped REIT Index ETF is not a designated ESG ETF like the Jantzi and KLD funds, ModernAdvisor has reviewed the fund’s underlying investment and found that it largely meets ESG criteria.

“[Those] are five funds that will change the composition of the portfolio to give it as much of an ESG tilt as possible,” Boostani says, “while still making sure that the portfolio is diversified.”

The management expense ratio (MER) for some of the ETFs are a little higher than some of the other offerings on ModernAdvisor’s shelf. However, Boostani feels confident that investors interested in these ETFs won’t mind the slightly higher fee — particularly if they’re not likely to give up potential investment returns.

“If you go back 10 to 12 years, the performance [of RI funds] actually beats the S&P/TSX 60 index in Canada and the S&P 500 composite index in the U.S. by a narrow margin,” Boostani says. “So, we don’t feel that investors are necessarily giving up their investment returns by choosing these portfolios.”

These MERs are in addition to ModernAdvisor’s management fees, which range from 0.35% to 0.5% a year.

ModernAdvisor joins several robo-advisors operating in Canada, including: Wealthsimple Financial Inc., Nest Wealth Asset Management, Smart Money Capital Management Inc., and Bank of Montreal’s SmartFolio, all of which are based in Toronto, as well as Vancouver-based WealthBar Financial Services Inc. and Oakville, Ont.-based Invisor Investment Management Inc.

These digital asset-allocation firms all have a range of ETFs at their disposal, although some offer other products as well. For example, WealthBar investors have access to pooled funds managed by Vancouver-based Nicola Wealth Management Ltd. while Invisor offers investors mutual funds.