Canada’s Expert Panel on Sustainable Finance recommends incentives to green pensions, RRSP’s

Canada’s Expert Panel on Sustainable Finance released its final report on June 14,  Mobilizing Finance for Sustainable Growth . The report makes fifteen recommendations,  stating “…. climate change opportunity and risk management need to become business-as-usual in financial services, and embedded in everyday business decisions, products and services.”  Although the Panel’s main focus was on institutional investments, they also made recommendations which would help individuals to make greener personal investments.

Tiff Macklem, Chair of the Expert Panel,  summarizes and simplifies the message of the Panel Report in “Climate change should be part of regular savings and investment decisions” in The Conversation  on July 3.  Concerning individual actions,  he states:  “To accelerate climate-conscious investment, we … recommend actively engaging Canadians in the climate opportunity and making their stake in fighting climate change more tangible…To engage them, we recommend the federal government create an incentive for Canadians to invest in accredited climate-conscious products. Specifically, we recommend that the Minister of Finance create additional space in RRSPs and defined contribution pension plans for these investments and offer a “super deduction” — in other words, a taxable income deduction greater than 100 per cent —on eligible investments.”   This proposal was further explained in “Expert panel on sustainable finance recommends super tax deduction to incentivize green savings” in Benefits Canada magazine.

Other recommendations in the final Report include:  Establish a standing Canadian Sustainable Finance Action Council (SFAC), with a cross-departmental secretariat, to advise and assist the federal government in implementing the Panel’s recommendations;  Establish the Canadian Centre for Climate Information and Analytics as an authoritative source of climate information and decision analysis;  Define and pursue a Canadian approach to implementing the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD). Although the recommendations include goals for private financing of the building retrofit market and clean tech industry, they also include a call to support Canada’s oil and natural gas industry “in building a low-emissions, globally competitive future.”

 

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