Home Greenhouse Ontario Teachers’ Pension Plan sets targets to achieve zero net greenhouse gas emissions

Ontario Teachers’ Pension Plan sets targets to achieve zero net greenhouse gas emissions

0


TORONTO – The Board of Directors of the Ontario Teachers’ Pension Plan has set new goals to support its plan to fight climate change and reduce greenhouse gas emissions from its portfolio of several billion dollars.

Canada’s largest single-professional pension plan said Thursday it aims to reduce the carbon intensity of its investments by 45% by 2025 and two-thirds by 2030, compared to its benchmark of 2019.

The targets come after the $ 227.7 billion fund announced in January a commitment to achieve zero net greenhouse gas emissions by 2050.

The engagement reflects growing pressure on major institutional investors to finance clean energy and divest assets that contribute to climate change.

Read more:

Ontario Teachers’ Pension Fund Returns 3.8% for First Semester of 2021

Advocates have long called on managers of massive funds around the world to invest more ethically and sustainably, a call some institutional investors seem to heed.

The story continues under the ad

The Norwegian sovereign wealth fund manager, for example, said earlier this year that he planned to halt investments in a number of Canadian oil and gas companies after concluding they were producing unacceptable levels of gas emissions at greenhouse effect.

Canada’s large pension plans have also been the target of environmental and human rights campaigns in recent years.

The Canada Pension Plan Investment Board came under scrutiny for its stake in two private prison operators that operated migrant detention camps along the US-Mexico border. The Office finally sold its shares in 2019.

In January, an environmental coalition called on Ontario teachers to put pressure on their pension funds to divest companies that develop or transport fossil fuel products.

A few weeks later, Teachers’ announced its commitment to achieve zero net greenhouse gas emissions.

While the commitment is not limited to outright divestment from fossil fuels, it focuses on investing in green businesses and encouraging companies in its portfolio to go carbon-free.

READ MORE: Ontario Teachers’ Pension Plan targets zero net greenhouse gas emissions by 2050

Teachers’ chief investment officer Ziad Hindo said the fund’s targets are the best in the industry and may encourage other big funds to invest in environmentally friendly assets.

The story continues under the ad

“The entire world economy must be re-equipped for the climate transition,” he said in an interview. “We see this as an opportunity for us to be an active and engaged investor. “

Part of the fund’s commitment is to work with companies on developing decarbonization plans to make them more sustainable, Hindo said.

“We have over 100 companies in the portfolio on the private asset side and part of our commitment is to work with our private equity stakes, through our governance channels, to ensure they can have their own net zero goals aligned with Paris. “, did he declare.

“Part of our secret sauce is value creation, to help these companies _ given our significant holdings _ to transition, to decarbonize and play a role in helping the economy reach net zero. “

Teachers’, which invests and administers the pensions of 331,000 active and retired Ontario teachers, said it would report annually on its progress towards meeting its goals for 2025, 2030 and 2050.

Shift Action for Pension Wealth and Planet Health, part of the environmental coalition that appealed to Ontario teachers earlier this year, welcomed the new goals but said the pension plan needs to go further s ‘he wants to be a global climate leader.

“While this announcement describes how the OTPP will invest in solutions to the climate crisis, it makes no mention of how it will eliminate its exposure to the root cause of it, which is high-risk fossil fuels.” , the advocacy group said in a statement. .

The story continues under the ad

Natasha Bartels, a high school teacher in Toronto, said the plan “still doesn’t tackle the elephant in the room – its multibillion-dollar investments in oil, gas, coal and pipelines.”

“I have repeatedly asked the OTPP to explain how their continued and growing investments in fossil fuel businesses and infrastructure are aligned with their commitment to net zero emissions, and they have not provided a credible response. . “

© 2021 The Canadian Press