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Canada’s biggest pension fund demands SASB and TCFD disclosure

CPPIB updates its sustainability policy as Ontario considers integrating the two frameworks into regulation

The Canada Pension Plan Investment Board (CPPIB) is asking companies to report in line with the Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-related Financial Disclosures (TCFD). 

The C$410bn (€263bn) scheme has updated its sustainability policy to “ask that companies report material ESG risks and opportunities relevant to their industries and business models, with a clear preference for this disclosure to focus on performance and targets”. 

“When issuers seek input, the organisation now indicates its preference for companies to align their reporting with the SASB and TCFD standards,” it said. 

Richard Manley, Managing Director, Head of Sustainable Investing at CPP Investments said the policy “reflects the growing body of evidence showing that companies that integrate consideration of ESG-related business risks and opportunities are more likely to preserve and create long-term value."

The updated policy also highlights the role of active engagement with companies on ESG. 

The move comes just weeks after the Government of Ontario published a consultation report from the region’s Capital Markets Modernisation Taskforce, which recommended making TCFD- or SASB-compliant disclosure mandatory for issuers by updating the regulatory filing requirements of the Ontario Securities Commission.

The recommendation was one of nearly 50 proposals aimed at modernising the regulation of Ontario’s capital markets, promoting investor protection and fostering innovation. The taskforce is seeking written submissions on the proposals before September 7, and the final report and recommendations are expected by the end of the year.

Canada’s Task Force for a Resilient Recovery also issued recommendations this week, calling for C$50bn of green government spending to help aid the country’s recovery from Covid-19. The proposed post-pandemic stimulus package would include C$27bn to retrofit buildings to make them more energy efficient, as well as pushing zero-emission vehicles to help attract and retain clean vehicle manufacturers in Canada.

Earlier this week, a member of the Resilient Recovery Task Force, Barbara Zvan, was named the inaugural President and CEO for the University Pension Plan Ontario (UPP). Zvan, a former advisor to the Canadian Government on green finance, told RI that sustainability would be a key consideration in the new pension fund.