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ANALYSIS: New climate report shows OTPP is listening to teachers- but there’s much more to do

The Ontario Teachers’ Pension Plan, Canada’s third largest pension, committed in January to net-zero emissions by 2050, and in September set interim targets for getting there, but it wasn’t until this week that the OTPP disclosed crucial details on how exactly it plans to achieve its goals. Shift Action for Pension Wealth and Planet Health breaks down the highlights and examines what still needs to be done.

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Statement on the CDPQ’s oil producer divestment and new emissions intensity targets

The Caisse de dépôt et placement du Québec’s (CDPQ) 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.

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Statement from Shift Action for Pension Wealth and Planet Health on the Ontario Teachers’ Pension Plan’s purchase of a stake in Puget Sound Energy

Yesterday, the Ontario Teachers’ Pension Plan (OTPP) announced that it is partnering with Macquarie Asset Management to purchase a 31.6% stake in Puget Sound Energy (PSE) from CPP Investments. While PSE certainly has the potential to become part of the solution to the climate crisis, that is not the case today.

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Statement from Shift Action for Pension Wealth & Planet Health on PSP Investments’ annual report and responsible investment report

PSP Investments has made early progress in putting in place the internal tools and processes required to assess and manage the financial risks of climate change. However, it is unclear how PSP is using this climate-related information to protect the pensions of more than 900,000 federal public servants and align their retirement savings with a safe climate future.

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Statement from Adam Scott, Director of Shift, on the significance for Canadian finance institutions of the IEA’s new Net-Zero by 2050 outlook

The release of the International Energy Agency’s new 1.5℃ energy scenario is game changing for the responses of Canadian finance institutions to the climate crisis. The world’s most influential energy modelling analysis provides essential clarity on what is required to achieve the energy transition in line with the goals of the Paris Agreement.

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Statement from Shift Action for Pension Wealth and Planet Health on climate-related financial risk in the Ontario Teachers’ Pension Plan’s 2020 annual report

All things considered, the Ontario Teachers’ Pension Plan (OTPP) weathered the pandemic storms of the past year effectively. However, the economic shocks from COVID-19 have revealed the growing long-term risks of the fund’s exposure to fossil fuel investments, and the growing financial benefits of shifting capital into climate solutions.

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Statement from Adam Scott, Director of Shift Action for Pension Wealth & Planet Health, on BMO’s Unambitious “Climate Ambition” announcement

BMO’s commitment to net-zero emissions by 2050 is another welcome acknowledgement that finance institutions have an obligation to address the climate crisis through their lending and investment decisions. Yet Canada’s banks have so far failed to acknowledge the requirement to immediately and dramatically shift financing away from fossil fuels and into climate solutions.

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Statement from Shift Action for Pension Wealth and Planet Health on the Ontario Teachers' Pension Plan's incomplete 2050 net-zero emissions commitment

We hope this announcement is a signal that the OTPP and other Canadian pension funds are finally ready to admit the scale of action the climate crisis requires of them. However, a commitment to net-zero emissions has little credibility on its own without announcing the concrete steps the OTPP will take to achieve this goal.

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Previous Posts

For posts prior to 2021, see https://www.shiftaction.ca/news-updates.

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