The Canadian pension sector is making progress in the transition to net zero, but there is a continuing divergence between leaders and laggards. The latest ‘Canadian Pension Climate Report Card’, published by Shift: Action for Pension Wealth and Planet Health, identified progress among 11 of the country’s largest pension managers on building internal climate expertise, efforts to help portfolio companies decarbonise, and movement towards strengthening fossil fuel exclusions. “The climate crisis is subject to the laws of physics and not to four-year election cycles,” said Adam Scott, Executive Director of Shift. “Far from an excuse for slowing climate action, political backsliding only increases the urgent need for financial leadership to fill the void. Pension funds require a stable climate to fulfil their mandates and obligations.” The Investment Management Corporation of Ontario was named a leader, alongside Ontario’s University Pension Plan and the Caisse de dépôt et placement du Québec, edging past another early leader – the Ontario Teachers’ Pension Plan. Others, such as the Public Sector Pension Investment Board and the British Columbia Investment Management Corporation, are lagging behind as they refuse to commit their portfolios to net zero emissions, the report said. “As long-term investors with assets around the world, pension funds have no choice but to act as a bulwark against climate backsliding,” said Laura McGrath, Senior Manager at Shift. “In order to protect their members’ retirement security as the climate crisis worsens and the energy transition accelerates, pension funds have to be the adults in the room.”
