Member owned and operated, credit unions have long been an example of democracy in the financial world.

One credit union in Canada partnered with an investment firm and used Ethelo to gauge investment preferences — an example of how the constituent engagement process can extend to the financial sector.

The Sunshine Coast Credit Union is a full-service financial institution that offers a variety of banking and investment options to its members. The credit union partnered with Rhiza Capital to invest its members’ funds and sought input on how best to enter the realm of impact investing.

Rhiza Capital CEO Brian Smith knew that Ethelo would be the best tool for obtaining that feedback.

“A credit union is a democratically-owned institution, so it made a lot of sense to use a piece of democracy technology to advance a credit union,” Smith said.

Balancing trade-offs

Just about everything in life has trade-offs, but they take on a whole new dimension in the financial world. Every dollar that’s invested in one way is a dollar that’s not available for something else. Smith and the rest of the Rhiza team wanted to make sure those conditions were captured in the consultation.

“If an investor is expecting a financial return of say 10 percent or greater they may not be able to expect a big social impact,” Smith said. “Those tradeoffs needed to be incorporated into the design.”

The consultation in Ethelo asked users for their preferences on financial factors including:

Return on investment

Level of risk

Length of investment

Amount of impact

What type of causes funds should support

How impact should be reported

In real life, each of these factors impacts the others, and the set up in Ethelo was no different.

Ethelo included a visual representation of those preferences that changed as new information was added. Those trade-offs came into play at the end of the process when users ranked the importance of each investment topic.

In the end, each user received a snapshot of his or her ideal investment mix, while Rhiza Capital Management received a broad look at credit union member preferences.

Analyzing results

Rhiza had a goal of 600 respondents and ended up with about 650. The consultation generated more than 1000 comments, most of which were positive.

To save time on recruiting panelists, Rhiza utilized a company to recruit participants for the consultation. Ethelo provided that company with a link to the consultation through a special integration that made the experience seamless for participants.

For Smith, the real power of Ethelo came from data analysis, which allowed the project to move forward quickly once the consultation phase was complete. He was able to go back into Ethelo after the data was entered to adjust the variables behind the questions.

The data itself did not change, but Smith and his team were able to change the parameters to make them more realistic. This is another unique feature that Ethelo brings to the table.

“It worked just the way that I hoped it would,” Smith said. “We were able to clarify what respondents were saying and the motives behind it.”