Canada’s second largest pension fund joins Harvard, the MacArthur Foundation in divestment away from fossil fuels

The Caisse de dépôt et placement du Québec (CDPQ),  the second largest pension fund in Canada, announced on September 28 that it will exit oil production investments at the end of 2022. The new, complete Climate Strategy document is here, and is built on four “vital and complementary pillars, as summarized in a press release

  • Hold $54 billion in green assets by 2025 to actively contribute to a more sustainable economy. 
  • Achieve a 60% reduction in the carbon intensity of the total portfolio by 2030.
  • Create a $10-billion transition envelope to decarbonize the main industrial carbon-emitting sectors. 
  • Complete our exit from oil production by the end of 2022.

Reaction from pension  activist group ShiftAction states that the : “move to exclude investments in oil producers from its portfolio by the end of 2022 is a welcome and significant move that improves the CDPQ’s position as a climate leader among Canada’s major financial institutions. It is amazing that it took until 2021 for a Canadian pension fund to finally recognize that protecting our retirement savings from the worsening climate crisis inevitably requires abandoning market exposure to high-risk fossil fuels…. To achieve climate safety, investment in fossil gas production and infrastructure must also be urgently phased out…… The CDPQ’s progress stands in stark contrast to the Canada Pension Plan, whose CEO said earlier this year that the Canada Pension Plan has no plans to institute a blanket screen on oil and gas during his tenure.”   (Neither does the Ontario Teachers Pension Plan, as quoted in the Toronto Star article,  “Canada’s oil industry dealt a financial blow as pension giant divests itself of investment in fossil fuel”) .

New Canadian campaign demands information from pension fund managers

On September 29, letters were delivered to the boards and executive of Canada’s 10 largest pension fund managers, asking for specific and detailed answers by December, about how the funds are meeting their legal fiduciary obligations in the face of the global climate crisis. According to a Greenpeace press release , the letters were coordinated with ShiftAction and Ecojustice. The letters were signed by members of the respective pensions funds, along with some of their union representatives , and were accompanied by appendices of analysis and a legal brief. The 9-page letter to the Ontario Municipal Employees Retirement System, co-signed by Fred Hahn, President of CUPE-Ontario serves as an example.

Global divestment momentum

All of this is part of the growing momentum of the divestment movement in the lead-up to COP26.  On September 10, after years of resisting activist campaigns, Harvard University announced that its $42 billion endowment will bar any future investments in coal, oil and gas.  Stand.earth states: “this landmark announcement marks a tipping point that will cascade throughout mainstream endowments and financial institutions globally.”   On September 22, Reuters reported “MacArthur Foundation joins investment shift away fossil fuels”, stating that the $8.2 billion fund “is the largest foundation in the world to commit publicly to fossil-fuel divestment to date.” Bill McKibben, one of the architects of the global divestment movement, sums it all up, including the new Caisse de dépôt climate policy, in his article “Starving the Beast” (Crucial Years, Sept. 29).

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