Key climate takeaways from the 2024 CPPIB public meetings
Over the last month, the Canada Pension Plan Investment Board (CPPIB) held public meetings in eight cities across Canada. These CPPIB meetings, which happen once every two years, are a rare opportunity to engage directly with the staff and executives that manage the $647-billion Canada Pension Plan on behalf of over 22 million contributors and beneficiaries.
The climate crisis, fueled by the burning of oil, gas and coal, poses an existential threat to our retirement security. CPPIB has a fiduciary duty to all working and retired Canadians, young and old, and is mandated to maximize returns without undue risk of loss. Its investment and asset management decisions are critical to how Canada and the world navigate the global transition to a clean energy future.
That’s why so many Canadians showed up to these public meetings to question CPPIB’s contradictory approach to climate risk and significant investments in fossil fuels. Thousands more Canadians submitted questions online.
Canadians in Ottawa on October 10th, Winnipeg on October 17th and Vancouver on November 4th used their mobile phones to capture audio and video recordings of the CPPIB meetings. After reviewing these recordings, which included questions from Canadians and answers from CPPIB staff and executives, here are Shift’s five key climate takeaways from the public meetings.
In the analysis below, Shift has provided the meeting location and timestamp of direct quotes made by CPPIB staff and executives.
1. Canadians made their concerns about climate change, fossil fuel investments and Indigenous rights impossible for CPPIB to ignore
Attendees in Ottawa hold a rally outside before heading into the CPPIB public meeting.
At each of these CPPIB public meetings, questions about climate change and CPPIB’s significant investments in fossil fuels dominated the hour-long Q&A sessions. Another 7,200+ Canadians submitted such questions online. In Winnipeg, there were so many Canadians lined up to ask climate-related questions that CPPIB staff asked them to step aside so that CPPIB could address other issues. In Ottawa and Vancouver, CPPIB agreed to extend the meeting beyond one hour because so many Canadians wanted a chance to engage CPPIB staff.
It is clear that Canadians understand the existential threat posed by climate change and the role that our national pension manager must play in protecting our retirement security on a livable planet. A CPPIB executive confirmed at the public meeting in Vancouver on November 4th that CPPIB is taking the climate risks seriously:
“I think we completely agree with you that climate change risk is an existential threat… it is the single biggest investment risk that we face… we’re very well aware, whether it’s physical risks within the portfolio, whether it’s stranded assets, these are all major threats to our portfolio, and it’s one that we are extremely preoccupied with…”
Let’s hope that CPPIB follows through on the message Canadians delivered and stops gambling our national retirement fund on the oil, gas, coal and pipelines that are fueling the climate crisis.
2. A concerning lack of transparency from CPPIB
It isn’t easy to organize meetings in cities across Canada over the course of a month and respond to tough questions from a room full of passionate people. Shift recognizes the efforts of the dedicated CPPIB staff who organized these public meetings and calmly responded to their questions.
But many attendees felt that CPPIB staff did not meaningfully answer their questions. They reported that they felt the meetings were a public relations exercise that generated sanitized, rehearsed answers that didn’t actually address their climate concerns. While CPPIB recorded these public meetings, staff told meeting attendees that the pension manager does not intend to make audio and video recordings and written transcripts of the meetings available to the public.
Luckily, Canada Pension Plan members used their mobile phones to capture audio and video recordings of the CPPIB meetings in Ottawa, Winnipeg and Vancouver.
This enables some semblance of transparency for the millions of Canadians who were unable to attend a CPPIB public meeting in person. It sheds some light on the questions that Canadians asked CPPIB at these public meetings, as well as the responses provided by CPPIB staff.
Shift urges CPPIB to make public their own audio and video recordings and written transcripts of the public meetings held across Canada in 2024.
CPPIB staff at the meeting in Vancouver on November 4th confirmed that “we’ve made a commitment to answer all the questions” (1:06:50)
Canadians can call on CPPIB to honour this commitment by using our new action tool to submit follow-up questions to CPPIB’s National Virtual Meeting on November 21st and request the public release of all official recordings and a written response to all questions submitted to the process online.
Picture taken by an attendee of CPPIB’s public meeting in Winnipeg, October 17th, 2024.
3. Confusing and misleading answers on CPPIB’s fossil fuel investments and their role in the energy transition
Canadians asked numerous questions about CPPIB’s fossil fuel investments, both in-person and online, but many left feeling confused and unsatisfied by CPPIB’s inconsistent responses.
For example, a CPPIB executive told attendees at the Ottawa meeting (at 1:06:20) on October 10th that 3.5% of the Canada Pension Plan – or $22.6 billion – is invested in fossil fuels. But at the November 4th meeting in Vancouver (at 53:00) , a CPPIB executive told attendees that 2.5% of the portfolio – or $16.2 billion – is invested in fossil fuels. A $6-billion difference in fossil fuel financing in the midst of a climate crisis is nothing to sneeze at, and Canadians should expect clear answers from the managers of our national retirement fund.
Correction (December 9, 2024): Upon further review of the audio recording of the Vancouver meeting, which was of poor quality and difficult to hear at times, Shift acknowledges that the CPPIB executive told attendees that 3.5% of the portfolio is invested in fossil fuels, which is consistent with what was said in Ottawa. Shift regrets this error.
In another Q&A exchange, a CPPIB executive claimed at the Vancouver meeting that “I do not believe (our exposure to fossil fuels) is increasing” (at 53:45). But Shift has documented at least six new investments in fossil fuel assets in 2024 alone, including:
a US$300 million commitment to expand fracked gas production in Ohio,
A proposed joint UDS$6.2-billion acquisition of a major U.S. utility player that includes a lignite coal mine and a fleet of coal- and gas-fired power plants
a 16,000-km oil and gas pipeline network in the U.S. Midwest,
a stake in California’s largest oil and gas producer,
a $1-billion pipeline expansion to fuel Alberta’s petrochemical industry, and
a US$500 million commitment to a private equity fund for oil and gas.
Companies already owned by CPPIB are also expanding and prolonging the use of fossil fuels. For example, in September, a CPPIB-owned company extended the piping of fracked gas from the Peruvian Amazon for at least another ten years. Another company co-owned by CPPIB acquired a new gas plant in Texas in September, part of a plan to add over 1,000 megawatts of gas-fired power generation over the next few years.
The same CPPIB executive also suggested in Ottawa, Winnipeg and Vancouver that CPPIB is investing in publicly-traded oil and gas companies that have credible transition plans – but neglected to provide an example of such a company. In Vancouver, the CPPIB executive referred to CPPIB’s investment in a California company “that might be 60% predominantly conventional energy, and they have a credible strategy to move, and over the next 10 to 15 years, completely get rid of that and move towards clean energy” (at 1:03:30).
Shift assumes that this executive is referring to CPPIB’s summer acquisition of an 11% stake in California Resources Corporation (CRC), the Golden State’s largest oil and gas producer. Yet CRC’s CEO said last month that he envisions expanding the company’s oil and gas production, while CRC contributed to record oil industry lobbyist spending to fight decarbonization policies in California in 2024. It’s concerning that CPPIB would tell Canadians that CRC has a credible climate plan, when the opposite appears to be true.
4. Gas is NOT a “transition fuel”
In Winnipeg on October 17th, a CPPIB executive made false, unscientific and contradictory claims about natural gas. In Winnipeg, the executive said that “We hope, and our investment thesis is, some cleaner forms of energy, particularly natural gas, will displace the most high-carbon forms, especially coal, and other forms of fossil fuel” (at 12:30)
The executive said that “we see (natural gas) as a transition fuel, relative to coal for example, or oil. If you’re going to have a transition fuel among the many options, (natural gas is) probably one of the better ones.” In the same response, the CPPIB executive acknowledged that “natural gas is not renewable at all” and that “it’s not the solution, obviously to get to net-zero” (at 27:00)
It is alarming that a CPPIB executive is telling Canadians that natural gas is a “transition fuel”, when the consensus climate science demonstrates otherwise. It is well-established that gas is a harmful fossil fuel primarily composed of methane and must be rapidly phased out to limit global heating to relatively safe levels. The economics for new gas projects are weakening, while reliance on gas in energy systems is a threat to energy security. A recent peer-reviewed study finds that liquefied natural gas in particular is more polluting than coal, so the climate benefits of replacing coal with gas are limited at best. See Shift’s Gas is not a “transition fuel” fact sheet for more information.
5. CPPIB must develop an Indigenous rights and reconciliation policy
At meetings in Ottawa, Winnipeg and Vancouver, CPPIB staff and executives said they recognize Indigenous groups as rights and title holders, are regularly engaging with Indigenous groups and stakeholders, and have formed an interdepartmental committee to study the implications of the United Nations Declaration on the Rights of Indigenous Peoples. They also recognized the importance of companies and investors attaining “social license” to operate in Indigenous communities and specifically mentioned the right to Free, Prior and Informed Consent. In Vancouver, CPPIB asked Wet’suwet’en Hereditary Chief Na’Moks to ask the first question of the meeting.
These are encouraging signs that CPPIB, a Crown corporation that owns assets on stolen Indigenous land in Canada and around the world, understands the importance of Indigenous rights and reconciliation. But symbolic gestures are no replacement for an official commitment followed by action. That’s why Shift strongly supports Chief Na’Moks’ call for CPPIB to develop and implement an Indigenous rights policy that ensures CPPIB obtains the Free, Prior and Informed Consent of Indigenous peoples whose traditional territories are affected by CPPIB investment decisions, and to include this commitment in its proxy voting guidelines.
Wet’suwet’en Hereditary Chief Na’Moks asks the first question at the CPPIB public meeting in Vancouver.
By law, CPPIB is required to hold public meetings in every province every two years, so it’s not often that Canadians have an opportunity to engage directly with the managers of our national pension fund. This fall, Canadians showed up in droves to tell CPPIB that they are deeply concerned about climate change and CPPIB’s ongoing use of our collective retirement savings to invest in the oil, gas, coal and pipelines that are fueling the climate crisis.
Unfortunately, Canadians left these meetings feeling discouraged that CPPIB wasn’t meaningfully answering their questions and isn’t treating the climate crisis like the existential threat to our future that it is. There is no retirement security without a safe climate future to retire into. CPPIB’s mandate could become impossible to fulfill if we fail to avert the worst outcomes of climate change.
We need more Canadians to make sure our pension managers understand this. Join out growing movement by registering for CPPIB’s National Virtual Meetings on November 21st and submitting your questions about climate change and fossil fuel investments today!