The Caisse de dépôt et placement du Québec (CDPQ), one of Canada’s largest institutional investors, has announced a significant escalation of its sustainable investment targets, pledging to invest US$400 billion by 2030 in climate-aligned companies and low-carbon technologies.
The renewed commitment follows the early achievement of the pension fund’s previous sustainability goals. “We are reaffirming our sustainable investing convictions because they are at the heart of our fiduciary responsibility,” said Charles Emond, CDPQ’s president and chief executive. He added that the fund will continue encouraging its portfolio companies to adopt “clear and credible” decarbonisation strategies that align with long-term value creation and prudent risk management.
The announcement comes at a time of increasing political uncertainty for sustainable finance in Canada. The Canada Pension Plan Investment Board has recently abandoned its net-zero target for 2050, and the Royal Bank of Canada scrapped its sustainable finance commitments in April after withdrawing from the Net-Zero Banking Alliance. BlackRock, the world’s largest asset manager, also announced the closure of several US-based sustainable funds just last week.
Sustainable investment advocacy group Shift noted in its latest quarterly report that strong political backing for fossil fuels in Canada presents a challenge to pension funds aiming to account for the financial risks associated with oil and gas exposure.
Bertrand Millot, CDPQ’s head of sustainability, underscored that the fund’s climate strategy is financially motivated. “We aren’t doing this to save the planet. We are doing this to make money. That is very, very important,” Millot said in an interview.
According to the fund’s statement, CDPQ will direct capital towards firms offering alternatives to fossil fuels, supporting natural carbon reduction, and bolstering community resilience to climate change. The fund also intends to invest in ‘climate solution enablers’, including software developers that assist businesses in meeting their climate targets.
Vinay Shandal, global head of sustainable investing at Boston Consulting Group, said there is strong long-term value in backing the energy transition. “It’s not only important for the climate; it also enhances energy security, industrial competitiveness, and access to critical minerals,” he said.
CDPQ’s stance contrasts with recent moves by other major players, but it is not alone in maintaining a long-term sustainability vision. The Ontario Teachers’ Pension Plan Board reaffirmed its commitment to achieving net zero by 2050, while the Ontario Municipal Employees’ Retirement System has pledged annual tracking and reporting of its decarbonisation pathway.
At British Columbia Investment Management Corp., climate remains a “cornerstone” of the investment process, said Jennifer Coulson, the organisation’s global head of ESG. “As one of Canada’s largest institutional investors, we continue to leverage our size and ownership rights to actively manage climate-related risks and opportunities in our portfolio, including through engagement, proxy voting, and policy advocacy,” she said.
