The town of Enterprise, NWT, destroyed by wildfires in 2023.
The town of Enterprise, NWT, destroyed by wildfires in 2023. Credit: Jeffery J. Nichols / Wikimedia Commons Credit: Jeffery J. Nichols / Wikimedia Commons

The Canada Pension Plan Investment Board (CPPIB) has left behind its commitment to having net-zero greenhouse gas emissions by 2050, a promise it first made publicly in 2022. Shift Action For Pension Wealth and  Planet Health (Shift), a pension fund accountability organization, said this move is an abdication of responsibility. The pension fund manages the retirement savings of more than 22 million Canadians 

The CPPIB’s annual report, released on May 21, did not include explicit language to continue its work toward achieving net zero emissions. 

In the report’s section on mitigating the risks climate change poses to their portfolio, the board wrote that they believe accelerating the global energy transition requires a sophisticated, long-term approach rather than blanket divestment. As well, the CPPIB’s FAQ section on their website says recent legal developments have resulted in new ways net-zero targets are being interpreted. The board writes that there is increasing pressure to adopt standardized emissions metrics and interim targets, many of which don’t reflect the complexity of a global investment portfolio like that of the Canadian Pension Plan.

“Forcing alignment with rigid milestones could lead to investment decisions that are misaligned with our investment strategy. To avoid that risk – and to remain focused on delivering results, not managing legal uncertainty – we have made a considered decision to no longer maintain a net-zero by 2050 commitment,” the CPPIB’s website reads. 

Shift says this decision will ultimately harm the savings of Canadian workers. In a statement, Shift pointed out that global GDP growth is already decreasing due to irregular climate events. In a post on their website, the Bank of Canada highlighted that severe weather, like wildfires and floods, can disrupt the economy. Infrastructure like roads, rail lines, buildings and machines could get damaged which will only further slow economic growth.

Many Canadians are already worrying about the viability of their retirement plans. Analysis by Eddie Shepherd and David Coletto from Abacus Data indicates that Canadians are shifting from a scarcity mindset to a precarity mindset. This means that, after years of high cost of living and stretched household budgets, many people are wondering whether their future is secure. Anxieties mainly relate to healthcare, retirement and the global economy. 

The CPPIB itself noted that 61 per cent of Canadians fear running out of money in retirement. This figure is based on a survey conducted by CPP Investments in late 2024. 

Shift says the abandonment of its net-zero commitment could put the portfolio of the CPPIB at risk down the line. 

“If the climate crisis isn’t addressed, experts have warned that pension funds like CPPIB are unlikely to generate the stable, future returns necessary to pay out their long-term obligations,” reads a statement from the organization. “In backing out of a promise to invest in line with its net-zero by 2050 commitment, CPPIB’s management has failed to undertake its most fundamental purpose – to responsibly manage the long-term collective savings of working and retired Canadians.” 

Beyond the financial risk this move poses, Shift also raised concerns about the physical health and safety of future retirees. Without action to mitigate climate change, extreme weather events are expected to continue and even worsen. The Government of Canada noted in October 2024 that the heat waves experienced during that year’s summer were very likely caused by human impact on the climate. 

In light of this, Shift asserts that net-zero commitments are not optional, but are necessary tools to manage risks and maximize long-term financial return. 

“Working Canadians currently under the age of 40 won’t be eligible to receive their CPP benefits until after 2050,” the organization’s statement reads, “What kind of a world are Canadians expected to retire into? How would CPPIB be able to sustain benefits in a world of climate breakdown?”

Gabriela Calugay-Casuga

Gabriela “Gabby” Calugay-Casuga (she/they) is a writer and activist based in so-called “Ottawa.” They began writing for Migrante Ottawa’s radio show, Talakayang Bayan, in 2017. Since then, she...