The Canada Pension Plan - Climate saving funds can give a better return on investment than climate polluting funds ‎to CPP’s 19 million members

May 27th, 2016 2:45 PM

Media Release



May 27, 2016 (Ottawa, Ontario) With the June 6th Canada Pension Plan Investment Board meeting drawing near, the standard right-left ideological argument over the future of the Canada Pension Plan is in full swing. The same old fight over individual or collective responsibility. Friends of the Earth Canada has entered the debate calling for the CPP to seriously address climate change with its new campaign www.pensionsforgreenfuture.ca.

“Canada has committed to do all it can to avoid a global temperature rise above 1.5 degrees. Everyone agrees it will take a tremendous transition of our economy to bring emissions down. Logic would dictate that Canada should focus its largest public pension fund on profitable climate saving investments,” says John Bennett of Friends of the Earth.

The Canada Pension Plan through its Investment Board is the country’s largest public investor with $300 billion in assets. It has a very respectable return rate and has outperformed financial expectations. But Friends of the Earth is raising questions about whether holding investments in climate polluting industries will hurt CPPs ongoing profitability.

Friends of the Earth isn’t the only one asking questions. Corporate Knights analysed the CPP with its “Portfolio Decarbonizer” tool and identified $6.5 billion in missed opportunities. By investing green, the CPP could have seen greater profits.

The Canadian Centre for Policy Alternatives investigated several pension funds and found the CPP is more heavily invested in fossil fuels and more exposed to climate policy risk than any other with about 22% of its Canadian and 6% of foreign investments in fossil fuel producers or pipeline companies.

The UK based Asset Owners Disclosure Project in its 2016 analysis says the CPPIB slipped from 37th to 74th on its list of investment funds disclosing climate risk.

“CPP, like many other big funds, should be changing its investment strategy to reflect and incorporate the risks of climate change but it’s not,” said Mr. Bennett.

Only a year ago, Canada Pension Plan Investment Board then CEO, Mark Wiseman said, “I don’t think we’d go buy Exxon, but we might buy a piece of Exxon if it were for sale.” He didn’t buy Exxon. He bought 95% of Encana’s gas and oil assets in Colorado spending $900 million in pension contributions. The Canada Pension Plan is now in the fracking business in Colorado communities clearly opposed to such climate polluting industry.

“Prime Minister Trudeau has said a great deal about acting on climate change and working with the provinces. He could start by re-focussing the investment strategy of the Canada Pension Plan to be climate saving rather than climate polluting,” said Mr. Bennett.

Anyone concerned about the ongoing profitability of his or her Canada Pension Plan can join Friends of the Earth in petitioning for a move to climate saving investments by going to www.pensionsforgreenfuture.ca

For more information, contact John Bennett, Friends of the Earth Canada 613 291 6888

Friends of the Earth Canada is the Canadian member of Friends of the Earth International, the world's largest grassroots environmental network campaigning on today's most urgent environmental and social issues.