Canada: Canada’s top pension funds boost investments in high-carbon oil sands

Canada’s biggest pension managers boosted their investments in the country’s major oil sands companies in the first quarter of 2021, raising questions about the funds’ recent commitments to greening their portfolios.

The cumulative investment by the country’s top five pension funds into the U.S.-listed shares of Canada’s top four oil sands producers jumped to $2.4 billion in the first quarter of 2021, up 147% from a year ago, a Reuters analysis of U.S. 13-F filings show. Much of that increase, which bucked a declining trend since 2018, came from rising prices of shares already owned, but the funds also purchased more shares.

The five funds, in order of size, are Canada Pension Plan Investment Board (CPPIB), Caisse de dépôt et placement du Québec (CDPQ), Ontario Teachers’ Pension Plan (OTPP), British Columbia Investment Management Corp (BCI) and the Public Sector Pension Investment Board (PSP), which together manage more than C$1.4 trillion ($1.2 trillion) in assets.

Governments, companies and investors around the world have stepped up pledges to drastically reduce climate-warming greenhouse gas emissions. Some large pension managers, including the New York State Pension Fund and Norway’s largest pension fund KLP, have exited oil sands companies.

Canadian pensions face pressure to balance a mandate to be environmentally responsible with their fiduciary duty to maximise returns. Canada’s oil sands are a high-carbon industry, yet their rising shares prices are tempting for investors.

The original full article can be found at reuters.com

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