While some Canadian pension funds “made helpful but modest tweaks” to their climate policies in 2023, even the leaders in the field lagged behind international peers in their efforts to build climate urgency into their investment choices and exclude fossil fuels from their portfolios, a watchdog group reports.
Among the 11 funds surveyed, the Canada Pension Plan Investment Board (CPPIB), which manages retirement savings for more than 22 million Canadians, “stands out as the biggest investor in and defender of fossil fuel investment in the Canadian pension sector,” Shift Action for Pension Wealth and Planet Health concludes in its second annual Canadian Pension Climate Report Card. “CPPIB appears to have an ideological commitment to fossil fuel investment.”
But across the sector, despite the extreme weather and devastating impacts Canadians saw in the warmest year on record, “reactions to these climate shocks did not, however, translate into commensurate action from Canada’s largest pension managers,” the report card says.
“This is troubling because pension funds have an inherently long-term investment horizon and a fiduciary duty to protect the interests of all of their members, including their youngest contributors, who won’t be retiring for several decades” and are particularly vulnerable to climate impacts.
Even in the year when the international community “finally named the primary culprits behind the climate crisis,” Shift adds, “Canadian pension funds still seem to have missed the message,” continuing to “invest their own members’ retirement savings in companies that are accelerating the climate crisis.”
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