Canada Pension Plan abandons 2050 net zero target
The Canada Pension Plan Investment Board announced it will be dropping its target of achieving net-zero emissions by 2050, only three years after the board made the pledge.
The Canada Pension Plan Investment Board announced it will be dropping its target of achieving net-zero emissions by 2050, only three years after the board made the pledge.
“Forcing alignment with rigid milestones could lead to investment decisions that are misaligned with our investment strategy,” reads a segment of CPPIB’s sustainability approach.
The pension plan accounts for roughly $714 billion in assets, and the Toronto-based CPPIB is among the largest private equity investors in the world.
The CPPIB cited recent legal developments as the reason for walking away from its net-zero target, calling its investment portfolio “too complex for the standardized emissions metrics and interim targets.”
According to the investment board’s website, the portfolio has seen a 41 per cent decline in its carbon footprint since 2020 and remains committed to sustainability.
Despite retaining its commitment to sustainability, the fund made no mention of the change in its Annual Report and Accounts released this week.
It was only stated that “achieving net zero by 2050 remains a widely adopted goal and critical ambition for many companies, countries and international organizations” but stopped short of any further commitments to it.
However, the website’s FAQ section does explicitly say that the firm no longer maintains its commitment to net zero by 2050.
“Recent legal developments in Canada have introduced new considerations around how net-zero commitments are interpreted,” it reads. “In particular, there is increasing pressure to adopt standardized emissions metrics and interim targets, many of which don’t reflect the complexity of a global investment portfolio like ours.”
CPPIB did not respond to True North’s request for comment.
The CPPIB’s decision furthers the ongoing trend of major financial institutions walking back their climate change goals.
The Royal Bank of Canada dropped its sustainable finance commitments following changes to Canada’s Competition Act, citing “shifts in public policy” and “consumer behaviour.”
“Given the complex and evolving nature of climate measurement methodologies, data availability and data quality, it is acknowledged that certain climate-related metrics contain a high level of measurement uncertainty,” wrote RBC in its sustainability report.
“Additionally, legislative and regulatory changes, market developments, shifts in public policy, industrial and technological advancements and/or consumer behaviour may impact our climate strategy. As a result, we intend to monitor and update our climate strategy to reflect such changes as we deem necessary.”
Other investment firms to follow suit in the wake of the U.S. election have been JPMorgan Chase & Co., Wells Fargo & Co. and Bank of America Corp.
ESG, DEI and climate doctrine fail against common sense behaviour.
Another nail in the Carney Liberal narratives.
It is evident that CPP is run very poorly as it is doesn't even make the top 10 best performers in the world. Yet it paid their CEO over $6.2 million. It's pretty bad if these guys don't recognize what companies they must invest in in order to support Canadians. Canada will not support or rely on green energy to power our industries or vehicles.