When it’s time to put words into action in the fight against climate change, the Caisse de depot et Placement du Québec isn’t as “green” as it claims, a study supports.
Last year, the Caisse voted 67% against resolutions of an environmental nature presented at the annual meetings of Canadian banks and North American hydrocarbon, manufacturing and detail companies, according to a recent analysis by the British-Colombian organization Investors for Paris Compliance (I4PC).
“Honestly, we were surprised by this conclusion. If we had to bet, we would have said that the Caisse would have been a leader in this area,” Kyra Bell-Pasht told the Journal.
I4PC reviewed 19 of the 36 Canadian wealth managers that are members of the global Climate Action 100+ initiative.
The goal of this group of institutional investors is to put pressure on the world’s most polluting companies to significantly reduce their greenhouse gas (GHG) emissions to ensure compliance with the goals of the Paris climate agreement signed in 2015.
Bâtirente, a model
Other Quebec investors fared much better in the study: Bâtirente, a CSN-affiliated pension plan, did not oppose any of the 23 resolutions reviewed by I4PC. He is the only Canadian investor to have achieved a perfect score.
Montreal firm Addenda Capital also distinguished itself by voting against only 23% of the resolutions in question.
For its part, Desjardins International Asset Management voted against 41% of the resolutions.
In all of Canada, the worst fool is the Toronto-based Bags Goodman, which voted against 91% of the resolutions.
In several cases, large investors have faithfully followed the recommendations of the American proxy advisory agencies ISS and Glass Lewis, Investors for Paris Compliance notes in its report.
“accompaniment”
“Our team of experts seriously considers any shareholder proposal on climate,” Caisse spokeswoman Kate Monfette assured the Journal, but indicated that the Caisse attaches relative importance to votes at annual meetings.
Photo from LinkedIn
Kate Monfette
speaker
of the fund
“In terms of climate strategy, we prioritize supporting our portfolio companies to achieve concrete results, according to each individual’s capacities and reality,” said Ms. Monfette.
In 2021, the Caisse says it has discussed environmental, social or governance (ESG) issues with 194 companies in which it has invested, compared to 112 in 2020.
“Tea and Cookies”
However, Ms Bell-Pasht doubts the real usefulness of these discussions, which British activists have derided as a trivial exchange where we enjoy “tea and biscuits”.
“There’s this culture of politeness,” in which investors would suggest measures to companies to reduce their greenhouse gas emissions by gently threatening them with a negative vote at the next annual meeting, the expert points out.
“But on the climate issue, we have the feeling that things are changing,” she says.
“I am confident that the Caisse will change its practices,” adds Kyra Bell-Pasht. I’m curious to see how she will vote this year. It is an institution that has been progressive in other aspects of climate protection. »
The Caisse and the climate
- 67% negative votes on a sample of 23 environmental resolutions tabled at annual company meetings in 2022
- 41 tons -Emissions in CO2 equivalents per million dollars invested in 2021
- $39 billion of “low-carbon” assets in 2021
Sources: CDPQ, I4PC
An enviable carbon footprint
Even before it retired from the oil sector last year, the Caisse de depot et Placement du Québec already had an enviable carbon footprint.
In 2021, the institution estimated that carbon emissions associated with its portfolio would reach 41 tons per million dollars invested, or 48% less than the 79 tons calculated in 2017.
According to the Caisse, 40% of these emissions came from power generation using hydrocarbons.
Less coal
For comparison, the Canada Pension Plan Investment Board estimated its carbon emissions as of March 31, 2022 to be at least 46 tons per million dollars invested.
For example, the Caisse says it has offered support to electricity producers AES Indiana (USA) and Apraava (India) to reduce their coal consumption.
The Caisse’s balance sheet is likely to get even better in 2022, as the institution completed the sale of all its stakes in oil majors last spring. The Caisse had committed itself to this as part of a climate strategy presented in autumn 2021.
For 2030, the institution has set itself the goal of reaching the target of 32 tons of CO2 per million dollars invested.
A target of $54 billion by 2025
To this end, the Caisse intends to continue its investments in the field of renewable energies in particular.
It targets a portfolio of low-carbon assets worth $54 billion in 2025, up from $39 billion in 2021 and $18 billion in 2017.