Ontario Teachers’ Pension Plan (OTPP), one of Canada’s largest investors, with over $200 billion in assets under management, announced a new sustainability commitment, targeting net zero greenhouse gas emissions by 2050. The company stated that over the coming months, it will establish concrete targets for portfolio emissions and investments in climate solutions.
Jo Taylor, OTPP President and CEO, said:
“As a global pension plan, we will leverage our scale and influence to transition to a low-carbon economy and create a sustainable climate future. With coordinated action net zero by 2050 is an ambitious but achievable goal. We are committed to playing our part alongside other organizations and governments around the world to effect significant, positive change.”
In announcing its new goal, OTPP joins the ranks of several other major investors in the pursuit of net zero investments. In December 2020, the New York State Pension Fund, one of the largest pension funds in the US, and Macquarie Asset Management, the world’s largest manager of infrastructure, set 2040 net zero targets. Also in December, a coalition of 30 leading asset managers, representing over $9 trillion of assets under management, launched the Net Zero Asset Managers initiative, committed to supporting the goal of net zero greenhouse gas emissions by 2050 or sooner.
According to OTPP, key elements of its net zero initiatives will include increasing investments in climate-friendly investments and solutions, ensuring portfolio companies manage and report their emissions annually, working with portfolio companies to achieve net zero emissions by 2050, using green bond proceeds to invest in climate friendly opportunities, and increasing the resiliency of assets with physical risk assessments of direct holdings. OTPP will also advocate for clear climate policies and partner with global organizations to effect change.
Ziad Hindo, Chief Investment Officer, said:
“While the transition to the low-carbon economy presents many challenges, it also presents many opportunities to earn the returns we need to pay our members’ pensions while more broadly benefiting society and the environment.”