One place to watch is Nova Scotia, which has big plans to kick-start its offshore wind industry in order to meet electricity demand at home and beyond. Initially, the province is aiming for some 5,000 megawatts of offshore wind capacity.

“There is a lot of interest among developers,” says Elisa Obermann, executive director of Marine Renewables Canada, in an interview. “They’re looking for a country that has a stable regulatory environment and very predictable processes for their auctions and procurement.”

In January, the Canada-Nova Scotia Offshore Energy Regulator concluded a pre-qualification process for companies interested in participating in an upcoming call for bids. So far, Q Energy France, a division of South Korea’s Hanwha Group, has confirmed its interest and has publicly committed to investing in the province’s offshore workforce.

While total energy-transition investment rose in the U.S. last year, changes in U.S. climate policy are contributing to market uncertainty, and market uncertainty makes it difficult for companies and investors to plan ahead. The result is energy-transition investors start to consider putting their money elsewhere, outside of the U.S.

– Joanna Klimczak, Northern Light Capital Partners

But the federal and provincial governments will need to coordinate their efforts to ensure that heightened interest translates into tangible investment. Nova Scotia has a small domestic power market and is looking for federal support to build transmission to other provinces – and, possibly, the United States – in order to persuade offshore wind developers there will be a market for their power.

A nation-scale opportunity

On February 26, Canada’s energy minister, Timothy Hodgson, travelled to Nova Scotia to announce a $5-million federal support for a feasibility study into a proposed transmission project dubbed Wind West, which would deliver offshore wind power to markets beyond the province.

Nova Scotia “has an exceptional wind resource,” Hodgson told reporters. “The main constraint on [Wind West] is not the wind; the wind is there and it blows a lot,” he said. “The constraint would be where is the power going to go and how are we going to move it, so that’s what this is about today.”

The Nova Scotia effort is just one example of Canada’s surging interest in the energy transition. Across the country, federal, provincial and territorial governments are promoting investment in the sector to support the electrification of the economy and construction of new data centres. That includes renewable power, battery and long-duration storage, energy efficiency and electric vehicle infrastructure. Ontario is also pursuing nuclear, including the country’s first small modular reactor.

“There is no shortage of attractive opportunities for Canada to seize the moment,” says Joanna Klimczak, Montreal-based chief executive at Northern Light Capital Partners. “While total energy-transition investment rose in the U.S. last year, changes in U.S. climate policy are contributing to market uncertainty, and market uncertainty makes it difficult for companies and investors to plan ahead,” she says. “The result is energy-transition investors start to consider putting their money elsewhere, outside of the U.S.”

A front door for investment

Klimczak is a finance veteran who works with global asset owners on strategies to capitalize the energy transition. She recently co-convened a meeting between Energy Minister Hodgson and industry CEOs and executives. To secure foreign investment in clean-energy projects, Canada should have a “central front door” where global asset managers can go to track and access the investment opportunities across the country, she says. “Governments at all levels should consider to work together to centralize an entry point and market it highly, because the more investment capital Canada has to choose from and work with, the stronger our economy will be for all Canadians.”

In the United States, the Trump administration has rejected the scientific evidence of a mounting climate crisis and doubled down on fossil energy production while attacking the renewable sector. After record instalments in the third quarter of last year, the U.S. industry is anticipating a slowdown in the United States in 2026, the American Clean Power Association said in an end-of-year report: “Projects are facing heightened regulatory burdens and policy uncertainty, putting the future trajectory of clean power project deployments at risk.”

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All told, cancellations of clean-energy projects in the U.S. – including renewable power, storage and electric vehicle manufacturing – far outpaced new investment announcements in the U.S., according to the business coalition Environmental Entrepreneurs (E2), in a report released February 13. E2 recorded US$35 billion worth of investments abandoned last year, compared to US$12 billion of new investments that were announced. In 2024, the United States saw US$16 billion in clean-energy investments announced and only US$2.5 billion abandoned.

Canada’s renewable sector has seen setbacks, too, but the outlook remains bullish. The country’s wind, solar and electricity storage capacity grew by 56% over the past five years to 25 gigawatts, according to the Canadian Renewable Energy Association (CanREA). That’s equivalent to the capacity of 25 1,000-megawatt nuclear reactors.

Virtually every province or territory has some renewable-energy procurement underway. Over the next decade, CanREA forecasts that investment in new wind, solar and storage will be some $200 billion. CanRea doesn’t include nuclear or large-scale hydro in its forecast, but there, too, provinces are investing in new non-GHG-emitting power projects.

The missing piece: private suppliers

The growth rates would be even greater if provincial governments would unleash private-sector suppliers to meet surging demand without having to sell through government-controlled utilities. Alberta is the sole province with a market in which electricity producers can sell directly to industrial customers through power-purchase agreements. However, Premier Danielle Smith slammed the door on that option when her government ordered a moratorium on new renewable power projects.

Canada can quickly unlock much more corporate investment in renewables

In 2024, companies signed deals for more than 1,000 megawatts of renewable power, virtually all in Alberta, according to figures from the Business Renewables Centre (BRC) Canada, which advises companies on renewable power procurement. That market has since dried up except for some small activity through a Nova Scotia program.

BRC Canada director Jorden Dye says Canada could attract far more investment from multinational corporations that remain committed to meeting climate targets if provinces would relax their exclusive grip on power markets. The centre’s advisory council includes some of the world’s largest companies, including Amazon, Starbucks and Marriott International. “When you start seeing policy churn and policy uncertainty, companies start looking at whether there are opportunities to decarbonize other aspects of the business in other jurisdictions,” Dye says. “And Canada has definitely come up as a factor for that.”

Prime Minister Mark Carney has vowed to make Canada a clean-energy superpower, and both he and Energy Minister Hodgson have pointed to the need for electrification to make that happen. Trump’s war on renewables could prove a boon to Canadian clean-energy ambitions, but only if governments can create the necessary conditions to drive investment.

Shawn McCarthy is an Ottawa-based writer.

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CEC is a finance-led initiative, launched in 2021 and inspired by Climate Action 100+, the investor initiative that guided the Church of England’s attempts to engage Shell. CEC “drives dialogue” to help Canadian companies transition to net-zero. The project includes major long-term investors such as the Healthcare of Ontario Pension Plan (HOOPP), the Investment Management Corporation of Ontario, OMERS and the University Pension Plan. CEC’s initial list of engagement targets consists of 39 companies listed on the Toronto Stock Exchange. Its recently launched Net Zero Benchmark lays out a robust set of indicators to guide these engagements.  

Engagement can often be an important tool for investors. However, when it comes to the 10 oil, gas and pipeline companies targeted by CEC, an active ownership approach is a dead end.  

That’s the conclusion reached in June by the Church of England Pensions Board, which had tried to engage the oil and gas sector for over a decade, including leading a “very intensive” investor engagement with Shell, the world’s second– largest investor-owned oil and gas company. 

Canadian investors have long taken the engagement route with oil companies, with little to show for it. Engagement is worthwhile only if it’s viable for a company to do what you’re asking. And for institutional investors like pension funds, engagement must come with a strong degree of likelihood that the company can generate long-term value while meeting your demands.  

But it’s neither viable nor profitable for fossil fuel companies to decarbonize or to meet CEC’s expectation that they “develop and implement a comprehensive strategy to reduce GHG emissions … consistent with the goals of the Paris Agreement.”.  

To do so, they would need to go beyond investing billions in unproven, uneconomical and unscalable carbon capture and storage technologies to eliminate their upstream operational emissions. They also have to phase –down the production and sale of fossil fuels in order to address the larger problem: life–cycle emissions, which are largely the result of the end– use combustion of their products.  

Aligning fossil fuel companies with climate goals requires a rapid production decline this decade, with a complete wind– down of all production destined for combustion by 2050 at the latest. It is not prudent to assume the industry can generate strong financial returns for investors at the same time that it voluntarily phases itself out, while also addressing its massive and growing liabilities. These are not financial risks our pensions should be exposed to, especially when fossil fuel investments have already underperformed relative to the wider market over the last decade. 

If fossil fuel companies can’t profitably be engaged to phase out production, should investors be trying to engage them at all? 

One might argue that engagement could lead to short-term emissions reductions. For example, reducing methane emissions would yield fast and significant emission cuts in the oil and gas sector. However, methane regulations are moving forward from the government, and compliance ultimately rests with the regulator, not the investors. 

One might also argue that engagement is better than selling shares to investors who don’t care about environmental performance. But there’s little evidence that pension funds’ ownership of oil and gas companies has led to meaningful emissions reductions. It’s hard to see this dynamic improving when the company’s business model is irreconcilable with achieving climate goals. 

The fossil fuel industry itself provides a compelling reason to give up on engagement: fossil fuel companies are busy walking back their climate commitments. 

After telling investors that it would cut production each year for the rest of the decade, Shell now says it will invest $40 billion more in oil and gas production in the next 12 years, with production remaining stable until 2030. This was the last straw for the Church of England Pensions Board, whose chief executive officer finally realized that the oil and gas sector doesn’t have “sufficient ambition to decarbonize in line with the aims of the Paris Agreement.” The respected investor is now divesting from all fossil fuels by the end of 2023 and will no longer try to engage with oil and gas. 

The fossil fuel industry itself provides a compelling reason to give up on engagement: fossil fuel companies are busy walking back their climate commitments. 

We’ve seen this before. BP claimed it would reinvent itself as a renewables company, setting early and ambitious targets. Yet despite 10 of its top institutional investors being members of Climate Action 100+, BP has also walked back its 2030 climate targets. It’s no wonder that a June report from Net Zero Tracker concluded that fossil fuel companies’ net-zero plans were “largely meaningless.” 

Certainly, some CEC participants are already mapping out routes to net-zero and discovering that fossil fuel companies don’t have a profitable way to get there.  

HOOPP, for example, recently announced that as of 2025 it would end new private investments in coal and oil. It is, however, baffling that HOOPP recognizes fossil fuels’ financial risks and incompatibility with climate safety in its private portfolio, yet –– like other CEC participants –– the fund continues to hold shares in publicly –traded fossil fuel companies, as if these companies somehow have a different prognosis. For pension funds, holding such shares will become a drag on delivering the pension promise. 

Investors can better protect their beneficiaries’ savings by eliminating their fossil fuel exposure and pushing governments to use all available tools to responsibly oversee a managed decline of oil and gas production and demand while ensuring a just transition for the sector’s workers.  

One of the world’s most experienced engagement leads, the Church of England Pensions Board, has walked away from oil and gas. Canada’s climate– conscious investors could look naive, and risk losing money, if they continue to act as if these companies have a future worth investing in.  

Laura McGrath is pension engagement manager at Shift: Action for Pension Wealth and Planet Health.

The post The time for engaging with fossil fuel companies is over appeared first on Corporate Knights.

Driven by concerns that investors are being misled, sustainable investment leaders are hoping to streamline and codify the sometimes-murky terminology of ESG investing (which takes into consideration environmental, social and governance factors).

“It’s very important that we have clear terminology that everyone understands,” says Roger Beauchemin, CEO of Addenda Capital and chair of the Canadian Responsible Investment Association (RIA). RIA is a member of one of the three sustainable investment networks that formed the Collaboration to Align and Refine ESG Terminology (CARET) late last year.

The CARET partnership includes the Global Sustainable Investment Alliance, made up of responsible investment networks in the United States, Europe, the United Kingdom, the Netherlands, Australia, Japan and Canada (RIA is the Canadian member); the Principles for Responsible Investment, with more than 5,000 signatory organizations managing over US$120 trillion in assets; and the Chartered Financial Analyst (CFA) Institute, the global professional body for more than 190,000 investment managers and analysts.

A technical committee is reviewing key ESG and sustainable investing concepts, which will go to a steering committee by the end of the year, says Mary Robinson, director of research and investor networks for RIA and a member of the CARET technical committee. Once the new terminology is finalized, the organizations will encourage the money management industry and investors to incorporate it into their own definitions of sustainable and responsible investment.

As well, organizers hope to influence the growing body of regulatory standards governing industry practice and disclosure, which has been triggered by greenwashing concerns.

“The regulators are concerned that investors may be getting misled – or mis-sold something that hasn’t been properly characterized,” Robinson said in an interview after participating in a session on the CARET project at the RIA conference in Toronto in early June.

The conference was held at an important time for the responsible investment industry in Canada and around the world. The sector has faced a steady drumbeat of greenwashing allegations and a series of regulatory crackdowns on misleading communications and marketing.

The theme of this year’s conference was “This is the moment to get it right,” a reference to a feeling by many in the industry that it has overpromised and underdelivered on environmental and social impact. This has become especially true in the last few years as UN climate change summits have raised expectations that global capital can be deployed to help solve the climate crisis.

Oversight lacking

The CARET project is a response to a problem that has its roots in the early 2000s, when small and medium-sized money management firms started to issue funds and other products with little regulatory oversight using basic ESG screening, engagement, thematic and impact investing strategies.

In the beginning, most banks and large money management firms didn’t pay much attention. But after rebounding from the financial crisis of 2008, they found a new market in sustainable investment and launched a barrage of funds using ESG integration as the dominant strategy.

The value of global sustainable investment assets jumped from US$23 trillion in 2016 to US$35 trillion in 2020. In the U.S., sustainable investments quadrupled from US$4 trillion in 2014 to US$17 trillion in 2020.

The regulators are concerned that investors may be getting misled – or mis-sold something that hasn’t been properly characterized.

 

– Mary Robinson, the Canadian Responsible Investment Association

Accusations of greenwashing grew along with this expansion.

Regulators responded with a wave of new rules. Europe established the Sustainable Finance Disclosure Regulation earlier this year, requiring funds to categorize themselves on a sustainable investment scale. Securities rulemakers in the U.S. and U.K. have proposed similar regulations. Last year, Canada set new disclosure guidance for funds with ESG names, requiring transparency on investment objectives and how ESG factors are evaluated and monitored.

The regulatory crackdown has resulted in ​a shrinking of official estimates of the size of the ESG industry. Asset managers are reluctant to publicize ESG funds that may be offside of the new rules. And industry researchers are scrutinizing which managers qualify for the sustainable label. As a result, the official estimate of sustainable investment assets in the U.S. has dropped from US$17 trillion in 2020 to US$8 trillion last year.

ESG integration under scrutiny

While all ESG strategies have definitional problems, ESG integration is generating the most confusion among investors. ESG integration is the explicit and systematic inclusion of ESG factors in investment analysis and investment ​​decisions.

“One of the biggest issues with ESG integration, and probably one of the sources of confusion, is that you can’t look at a portfolio to verify whether ESG has been integrated,” Robinson told the conference. This is different from sustainable investment screening or thematic strategies, for example, in which it’s easy to discern whether screens or themes are being adopted by looking at the companies in a portfolio.

In addition to ESG integration, the project is reviewing definitions for four other ESG strategies: screening (the exclusion of investments based on certain ESG screens – i.e., human rights violators or fossil fuel producers), thematic investing (investing in specified ESG themes, such as renewable energy), stewardship and engagement (management of ESG issues through corporate meetings and voting) and impact investing (the conscious investment of capital to create social or environmental impact).

A 2015 report from the U.S. Forum for Sustainable and Responsible Investment found that eight of 16 large money managers claiming to use ESG integration failed to disclose specific ESG criteria being integrated, or provided criteria only for certain asset classes such as property or fixed income.

The CARET project proposes to define ESG integration as the incorporation of ESG factors into financial risk management, distinguishing it from ESG screens or themes more associated with social or environmental impact.

This business is full of acronyms. We need to simplify that. We need to codify it.

 

– Roger Beauchemin, CEO of Addenda Capital and chair of RIA

“It should help reduce risk if you are considering material ESG factors that could have a material impact on your performance,” says Nicole Gehrig, the CFA Institute’s director of global industry standards. New ESG integration guidance from the CFA for managers and analysts is expected to be a part of the CARET recommendations.

By emphasizing ESG integration as a risk-reduction tool rather than a vehicle for environmental or social impact, the new definition of ESG integration will help to distinguish money managers who want to use it for risk management from those who want to tackle real-world problems like climate change by using the other sustainable investment strategies.

It remains to be seen how successful the CARET project will be in winning over the sustainable investing industry to its new terminology, or whether regulators will incorporate the new language into communication and marketing rules.

But Beauchemin says the project is vital to the future success of the industry. “This business is full of acronyms,” he says. “We need to simplify that. We need to codify it. Those are foundational pieces. And if we’re going to build, we need to have strong foundations that everyone agrees on.”

Eugene Ellmen is a former executive director of the Canadian Social Investment Organization (now Responsible Investment Association). He writes on sustainable business and finance.

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Add to the above fact that there is currently about $45 trillion of assets under management by 1,314 United Nations Principles for Responsible Investment (UNPRI) signatories – up from only $4 trillion back in 2006. UNPRI signatories commit to integrate six principals covering environmental, social and governance issues into their investment decision making and ownership practices.

Clearly, responsible investing is growing in importance – not only because it is good for our planet’s long-term prosperity but also because there is mounting evidence that it can lead to superior investment returns. For instance by subjecting equities from the high-carbon sectors in a given index to a performance test, related to normalised greenhouse gas emissions, and removing the ones with a below average performance relative to sector peers, it is possible to obtain a portfolio of securities with a lower carbon footprint while achieving superior total returns compared to the original index.

The low carbon U.S.

In the simulated case below, the “Low Carbon US” achieves a 56.7 per cent reduction in normalized greenhouse gas emissions with the bonus of an extra 7.8 per cent in total returns compared to the original index over the time period January 1, 2008 to August 31 2014.

The increased investor appetite for responsible investing has been made possible in part by the remarkable rise in the availability of sustainability data. Over the past decade, the number of corporate sustainability reports – the most common format for corporations to disclose their periodic environmental social and governance performance – has grown to 7,445 in 2013 from a mere 644 in 1999. A combination of heightened investor demand, activism and mostly regulatory intervention, coupled with a move towards greater transparency initiated by leading corporations, have all combined to drive increased sustainability disclosures.

For instance, on October 17, 2014, the Singapore Stock Exchange announced its intention to adopt a comply-or-explain mechanism for sustainability reporting for all of its listed companies. When implemented, this piece of regulation will add to the inventory of close to 170 policies in force around the world that are meant to encourage or mandate corporate sustainability reporting.

More, not better

While the number of sustainability reports has increased substantially, a closer look reveals some important findings. In its latest analysis of sustainability disclosure trends among the world’s stock exchanges, Corporate Knights Capital found that a sizeable chunk of the world’s large listed companies are failing to disclose their performance on the seven basic sustainability metrics – employee turnover, energy, greenhouse gas emissions (GHGs), injury rate, payroll (total employee compensation), waste and water. These seven basic indicators are objective measures of corporate sustainability performance that are broadly relevant for companies in all industries. Moreover, they are generally accepted as being the most widely tracked core sustainability metrics by various stakeholder groups including investors.

Click to enlarge.

For instance, only 39 per cent of the world’s 4,609 large listed companies disclosed their GHGs for the year 2012. For water, that percentage is 25 per cent. As for employee turnover rate, it is a paltry 12 per cent. While disclosure rates vary by sector, it means that a majority of the world’s large companies are not still not disclosing these seven basic sustainability metrics – in the case of GHGs, arguably the most universally recognized strategic sustainability issue, it has not been reported by more than 61 per cent of the world’s large listed companies. Even more disconcerting is the finding that only 128 (2.8 per cent) of all of the world’s large listed companies disclosed all the seven basic sustainability metrics for the year 2012.

Essentially, the remarkable rise in the number of sustainability reports has not been accompanied by a similar increase in the reporting of the basic sustainability metrics.

Equally troubling is that disclosure rates on the seven basic sustainability indicators appear to be plateauing. As one illustration, the number of large listed companies that disclosed their energy use increased by 88 per cent from 2008 to 2012 but only by 5 per cent from 2011 to 2012. A similar reporting slowdown is occurring on the other six metrics.

Clearly, a majority of companies are still not transparent enough to allow investors to make well-informed decisions over the long-term horizon by integrating foundational sustainability criteria. A point has been reached where virtually all the large companies that would have engaged in the reporting of the basic sustainability metrics have done so already and the remaining large companies likely have little or no intention of doing so under present circumstances.

Investors demand data

This is in stark contrast to investors’ growing interest in building sustainable investment strategies. Despite the notable progress made in corporate sustainability reporting, as shown above, there is still much room for improvement – not only in terms of quantity, but also in terms of consistency and timeliness. While virtually every company has reported on their financial performance six months after their year-end, only 63 per cent of these companies have disclosed their sustainability performance by then.

It is therefore not a surprise that in October 2014, the UNPRI and Ceres’s Investor Network on Climate Risk (INCR) launched an initiative to convey investors demands for more timely comparable and material disclosure of corporate sustainability information to the International Organization of Securities Commissions (IOSCO) in order to inform their investment decisions.

The IOSCO stands in a critical position in this regard through its direct relationship with member stock exchange regulators. Investors of all descriptions are encouraged to demand swift and decisive action from the IOSCO to provide greater clarity around sustainability reporting requirements, ideally to be integrated as part of existing financial disclosures.

The necessary tools are already available. For instance, IOSCO can take inspiration from UNCTAD’s Best Practice Guidance for Policymakers and Stock Exchanges on Sustainability Reporting Initiatives to facilitate a consistent implementation of corporate sustainability reporting requirements among member exchanges. This guidance is a voluntary technical aid to assist stock exchanges and regulators who have responsibility for corporate reporting practice and are contemplating the introduction of a new imitative – or further development of an existing one – to promote corporate sustainability reporting.

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Johannesburg model

The relative success of the Johannesburg Stock Exchange in spurring sustainability disclosure amongst listed companies through the implementation of the listing requirement incorporating the King III Code of Corporate Governance stands as a benchmark for inspiring investors and stock exchanges around the world. Ceres’ Investor Listing Standards Proposal, Recommendations for Stock Exchange Requirements on Corporate Sustainability Reporting, which engages global stock exchanges via the World Federation of Exchanges (WFE) on a possible uniform reporting standard for sustainability reporting by WFE members may also serve as a basis for the implementation of corporate sustainability reporting requirements among member exchanges.

Likewise, governments stand in a pivotal position to influence corporate sustainability reporting and are encouraged to renew their efforts in this direction. Existing policies around the world vary in many respects in terms of whether they are mandatory or voluntary, broad or narrow (i.e., applies to various industries as opposed to only one or a few specific industries) and prescriptive or principles-based (i.e., states which specific items of sustainability performance metrics are to be reported and how).

These wide differences in the type of policies may, in part, explain the differences in disclosure performance by the large listed companies of the seven basic sustainability metrics among the world’s stock exchanges, as shown in Corporate Knights Capital’s latest report on corporate sustainability disclosure trends. However, it was found that there is a strong association between policies that are mandatory, broad and prescriptive and better corporate sustainability disclosure performance. Policy-makers may use this finding as a framework to identify case studies as a framework to identify case studies and benchmarks for implementation in their own jurisdictions.

Disclosure frameworks

The advent of non-governmental standard-setters such as the Global Reporting Initiative (GRI), the Sustainability Accounting Standards Board (SASB) and voluntary disclosure frameworks, such as the CDP and the Climate Change Reporting Framework, have without a doubt, helped to popularize sustainability reporting. However, there exists a proliferation of fragmented and often competing reporting standards and frameworks when it comes to sustainability reporting that may bring confusion to both the reporters and the users.

A rapid and successful conclusion of the work among the participants to the Corporate Reporting Dialogue will bring about much needed clarity and comparability in corporate sustainability reporting, which will encourage more corporations to embrace more coherent and useful disclosures of sustainability performance. The Corporate Reporting Dialogue brings together financial reporting standard-setters and sustainability reporting frameworks to promote greater alignment, consistency and comparability between corporate reporting requirements, standards and frameworks. An endorsement by the major groups of users of corporate disclosures – both financial and non-financial – of the outcome of the work of the Corporate Reporting Dialogue will also help in determining the de facto global standard in corporate reporting.

The explosion in corporate sustainability reporting over the last 10 years or so has certainly helped to fuel the remarkable rise in responsible investing. Responsible investing is a much heralded practice whereby investment decisions consider long-term economic, social and environmental sustainability. However, current corporate sustainability reporting practices are at odds with the needs and level of interest from investors, such that a renewed effort is needed to bring sustainability reporting to the next level. Governments, regulators both public and private, business and non-business organizations, and investors all have an important role to play to make this happen.

The post Empowering responsible investing for long-term prosperity appeared first on Corporate Knights.

BNP Paribas Investment Partners, the Paris-based fund manager, is lobbying the pharma sector in support of the AllTrials campaign, which was started by U.K.-based Sense About Science, a charitable trust. The campaign is pushing for much greater transparency around clinical trials, a necessary and crucial step in the process of drug development. Unfortunately, around half of clinical trial results have never been published. Perhaps not a surprise, trials with negative results are twice as likely to remain unreported as those with positive results. At the same time, industry funded trials that have been published are much more likely than independently funded trials to show positive results. Helena Viñes Fiestas, who heads sustainability research at BNP, said some companies have faced enormous fines by not disclosing clinical trial data. As recently as 2013, several pharmaceutical firms paid over $10 billion in fines for not fully articulating secondary effects they were aware of. Companies have also been criticized for wasting significant amounts of money conducting unnecessary trials when such funds could be better directed towards research and development and trials that have greater potential.

Ottawa moves to protect Canada’s “brand” abroad

Canada is introducing a new social responsibility policy aimed at protecting the country’s positive “brand” in overseas markets, and mining and energy companies that don’t toe the line could find themselves cut off from government support. That includes financing and other supportive services from agencies such as Export Development Canada, not to mention the many Canadian embassies around the world that help companies gain a foothold in foreign markets. The news was reported in Friday’s Globe and Mail, which said that International Trade Minister Ed Fast is also appointing a new corporate social responsibility counselor with added powers to assure policy compliance. In addition, the federal government is requiring that resource companies comply with new transparency standards, by reporting, for example, payments made to foreign governments.

Viking women failing to crack glass ceiling

Sweden, Norway, Denmark and Finland are hailed as being more civilized societies because of the equal opportunity provided to women. As The Economist points out, the state provides world-leading coverage for childcare and maternity leave, and more women graduate from Nordic universities than men. Take a tour of their respective parliaments and women are equals or dominate the chambers, and mandatory quotas on corporate boards assure women are well represented. In the C-suite, however, and even among senior managers, women aren’t faring so well. As the magazine points out, Denmark, for one, was ranked 72^nd by the World Economic Forum when it came to the gender gap in upper management of publicly traded firms.

Barclays, MSCI launch green bond index family

Barclays and MSCI have come out with a new green bond index family that measures the global market of fixed income securities issued to fund projects and initiatives that have direct environmental benefits. Securities must pass an independent and objective assessment by MSCI ESG Research to be included in the index family. The assessment looks at how proceeds of the bond issue will be used, whether projects meet criteria, how funds will be managed, and how results will be reported. Additional fixed income index criteria are then applied to this screened universe to identify index membership on a monthly basis. “The availability of market standard indices is important in establishing clear, broadly accepted guidelines for the new issuers rapidly entering the market,” said Sean Kidney of the Climate Bonds Initiative. “The stature of Barclays and MSCI will help to bring attention to green bonds.”

NYC comptroller Scott Stringer leads board accountability project

The man who has auditing power over New York’s $75 billion annual budget and oversees the city’s five municipal pension funds – which together represent $160 billion in assets – is leading an initiative that aims to bring better corporate governance practices to the boardrooms of big U.S. corporations. Specifically, Stringer wants to leverage the huge shareholder clout that the country’s public pension funds have to push through long-needed governance changes. Corporate Knights’ managing editor Jeremy Runnalls chatted with Stringer about the Boardroom Accountability Project, which was launched last week with a coalition of large public pension plans. Its goal: pressure companies to let shareholders that control at least 3 per cent of company shares to nominate their own board candidates. “The fact is that friends of friends are still placed on boards and then often make decisions that are not in the long-term interests of shareowners,” Stringer told Runnalls. “I think this project promises to transform the dynamic between shareowners and corporate boards by giving investors real power to nominate corporate directors.

The post November 14, 2014 appeared first on Corporate Knights.

Australia’s Prime Minister Tony Abbott talks about coal as being the foundation of his country’s economy for the foreseeable future, and insists it is the only way to increase the prosperity of the poor in developing countries. “It’s good for humanity,” he was recently quoted as saying. Not so, says The Australia Institute, a progressive think tank. In a new report, the institute points out that Peabody Energy, one of the world’s largest coal producers, has no initiatives to alleviate energy poverty. And where companies in the coal industry do have initiatives, none of them are based on the use of coal. Instead, those coal companies are funding solar, hydroelectric and natural gas projects. “Despite extensive searches and contact with companies and mining lobby groups, we could not find a single example of where coal companies have supported coal-powered energy poverty alleviation projects,” the report states. It points out that organizations such as the United Nations, World Bank, and many non-governmental organizations are doing much more to alleviate energy poverty through programs relating to electrification, lighting and access to cooking facilities. “None of the main energy poverty initiatives promotes the use of coal,” according to the report, which also disputes the claim that coal use has been a driver of economic growth.

New business tool weighs water risk

You only need to look at California to see how climate change is impacting water resources, but water scarcity is a problem throughout the world and has huge impacts for business, as reported this week by Corporate Knights associate editor Ashley Renders. This is particularly true for companies that have a disproportionately high dependence on water, such as those in the food and beverage and agricultural sectors. Trucost, the natural capital research firm, and water technology provider Ecolab released this week a new tool called the Water Risk Monetizer. It’s free, and it’s being touted as the “industry’s first financial modeling tool that enables businesses to factor water into decisions that support business growth and help ensure the availability of this limited natural resource for future generations.” The tool, according to the companies, helps bridge the gap between market price and risk by calculating a risk-adjusted price. It essentially takes forecasted future water costs and layers a risk-based premium on top, giving companies a better sense of future costs.

Water projects get scrutinized for climate bonds

On a related note, more projects certified under the Climate Bond Standard could soon flow to water. The Climate Bonds Initiative, in collaboration with Ceres, the World Resources Institute, CDP and a number of other governmental and non-governmental organizations, has formed a new working group to explore the kinds of water projects that could qualify for funding through the issuance of green bonds. The aim is to identify what investments will boost the resiliency of water assets in a changing climate. As the most recent IPCC report makes clear, climate adaptation projects will need to ensure there are sustainable levels of clean water for a growing global population. “The potential for green bonds in the water sector is enormous,” said Sean Kidney, chief executive of the Climate Bonds Initiative. “While it may be tempting to define every water project as ‘green’, water investments that don’t take into account climate change, with, for example, its increased volatility of rainfall – dumps and droughts – will come to be seen as both higher risk and not consistent with green.” Kidney said some water projects risk perpetuating high water consumption or poor water management with high-energy usage. “This makes the need for guidelines even more urgent – investors will want to be sure that investments don’t make matters worse,” he said.

No evidence of wind turbine syndrome: Health Canada

Health Canada announced in July 2012 that it would conduct a comprehensive, independent study into the alleged health impacts of wind turbine noise. Wind opponents hailed the planned study as a major victory, while the wind industry expressed worry that it was an effort to undermine the growth of wind energy in Canada as a way to appease rural voters. Preliminary findings from that two-year study were released on Thursday, and the conclusion is consistent with research efforts from other countries: there is no evidence to suggest wind turbine noise makes people sick. As Corporate Knights editor-in-chief Tyler Hamilton wrote, the study didn’t cut corners. Government officials surveyed more than 1,200 households located near wind farms in Ontario and PEI. They collected hair samples and blood pressure data of residents so that stress levels could be analyzed. They also spent more than 4,000 hours measuring noise levels directly. While the research found some individuals annoyed by the turbines, which increased their level of stress, a connection with health outcomes was lacking. Strangely, as Hamilton points out, people in Ontario were much more annoyed by wind farms than those in PEI.

Quebec stands as roadblock to Energy East pipeline project

It has been known for a while now that Quebec wasn’t going to give TransCanada an easy ride on its proposed Energy East oil pipeline project. The province’s energy minister made that clear last month, and since then a number of smaller communities have expressed major concerns. Yesterday, Quebec’s national assembly unanimously voted on a resolution to exercise the province’s environmental jurisdiction over the project. Eric Flanagan, an analyst at the Calgary-based think tank The Pembina Institute, said the resolution amounts to a “vote of non-confidence” in the National Energy Board’s review process for the pipeline. It criticizes the regulator for not considering upstream climate impacts as part of its review, and the fact that the federal government has still not adopted carbon emissions regulations for the oil and gas sector. “Quebec’s elected representatives are adding their voices to a chorus of concern about this pipeline proposal and the environmental impacts of rapid oil sands expansion,” said Flanagan.

The post November 7, 2014 appeared first on Corporate Knights.

Rob Ford was the antithesis of an environmentalist. He never spoke of climate change or carbon emissions. The words “green energy” and “energy efficiency” weren’t in his vocabulary. When he talked about boosting public transit, it was in the context of improving life for people who drive. Indeed, he was determined to end what he called the “war on cars.”

I remember moderating a mayoral debate on the theme of “green government” during the 2010 campaign. Other than when he was slamming green energy for being too expensive – eliciting boos from the audience – Ford had this unique ability to not answer any of the questions directly or on theme. It was like we had four candidates seriously debating green issues and then, in the corner, was Rob Ford talking to himself about tax cuts and gravy trains.

Once Ford was elected, it was must have been a culture shock to bureaucrats who worked under previous environmentalist mayor David Miller, now chief executive of WWF Canada. Under Miller, Toronto became known internationally for its environmental leadership. Under Ford, Toronto became known internationally as the city with that crack-smoking, homophobic mayor that makes racial slurs.

A New Chapter

Now that John Tory is Toronto’s new mayor, what can we expect from him on the climate and environment file over the next four years?

For one, the words “environment” and “climate change” are again being spoken with what appears genuine concern and conviction. During his campaign, Tory talked about making Toronto a more sustainable community by boosting the city’s tree canopy by 3.8 million trees over the next 10 years. (Not to compare or anything, but motorcycle maker Harley-Davidson just revealed it aims to plant 50 million trees by 2025). Tory also wants to expand and improve maintenance of city parks, increase the number of green spaces, and revive the city’s 44,000-acre system of ravines – what he has referred to as hidden “crown jewels.” All welcome initiatives.

On energy, he has committed to creating a sustainable energy advisory board made up of local green energy, cleantech and sustainability leaders (Hey John, pick me, pick me!). The idea here is to get top advice on how to unlock energy efficiencies and where to embrace renewables as part of a plan to mitigate the city’s climate impacts. Toward that end, according to Tory’s environment policy, he would “work with other levels of government, partners and other jurisdictions on tackling climate change and its effects.”

One idea he has already put forth, long advocated by environmentalists, is the use of underutilized city assets and rights of way as locations for district thermal energy systems – e.g. geothermal, solar thermal or co-generation (biomass, natural gas). These systems could provide shared heating to buildings that are clustered closely together, and when developed across the city they would represent what Tory calls a “smart energy network.” It’s a more efficient way to supply heating, as countries such as Denmark have learned, and it has worked well in nearby communities such as Markham.

Also of particular interest is his plan to appoint an “environment advocate” for the city. This person’s job will be making sure environment policies are consistently applied – and coordinated – across all municipal departments, agencies, boards and commissions. The advocate will also have the task of developing a comprehensive climate adaptation plan for the city and its infrastructure, and a “realistic” and “achievable” plan to reduce greenhouse-gas emissions from municipal assets, improve waste diversion, and lower the amount of toxins released within city boundaries.

Best of all, progress on all of this is supposed to be documented in a “Sustainable City Report” to be released annually. Tory has promised to present this report himself to city stakeholders. It will be important to hold him to it.

Transit Challenges

It is on transit, however, that Tory has attracted the most attention – partly because there’s a big question mark over how he expects to pay for his plan, named SmartTrack. It targets the creation of a new 53-kilometre, 22-station aboveground subway service, one that would basically piggyback an existing regional rail corridor that is already targeted for electrification. He ambitiously claims he can get this ready within seven years, and that it would make it easier for people living in the suburbs – e.g. Markham, Scarborough, and northwest Etobicoke – to ditch their cars in favour of public transit.

Environmentalists like portions of Tory’s plan, but say it doesn’t go far enough. They preferred candidate Olivia Chow’s plan to significantly expand bus service, which would increase transit options to more areas and do it faster and at less cost. An open question is whether Chow’s approach would have reduced or led to more emissions compared to Tory’s plan, given that most Toronto buses run on diesel fuel.

Tory was also criticized by what some described as an unambitious plan to boost cycling infrastructure in the city. He called for more separated on-road bike lanes, more spaces to park bicycles, and more money for maintenance of existing lanes, but he didn’t provide a sense of how much he would expand the network.

Chow, on the other hand, pledged to create more than 200 kilometres of new bicycle lanes, which would roughly triple existing on-road lane infrastructure. True, Tory didn’t put a number on kilometres, but his openness to cycling as part of a strategy to reduce congestion and emissions is still a good sign. He can be pushed on this.

As a city cyclist, my own thought is that downtown Toronto is a chaotic, terrifying place to ride a bicycle. More separated bike lanes would help, but the real problem is rampant, uncoordinated condominium and road construction that gives little, if any, consideration to the impact on cyclists and their safety.

Creating a Smart City

Throughout his campaign, Tory spoke frequently about building intelligence into the way the city operates. He’s a big fan of intelligent building management systems, smart traffic management, and other technologies that collect and make sense of data that can reduce congestion, lower building energy costs and make the city, its residents and its businesses operate more efficiently. “Toronto should be at the forefront of the implementation of these technologies,” stated Tory’s economic plan, in which he outlined his intention to use the “market pull” of the city to turn Toronto into a global research and development hub for “smart city technology.”

One problem, in Tory’s opinion, is that the city hasn’t been taking advantage of the massive amounts of data it currently collects, most of which isn’t available to the public. He has cited that New York City releases 10 times more open data sets to the public compared to Toronto. “We should work to double the available data each year for the next 10 years until we are truly a global leader,” according to his economic plan.

The saying “you can’t improve what you don’t measure” is probably etched in Tory’s mind after his years as president and chief executive of Rogers Cable, where keeping the cable firm’s high-speed Internet service competitive with offerings from Bell Canada meant constant number crunching and analysis in search of efficiencies and a market edge. It’s why Tory plans to push for real-time energy monitoring for all municipal buildings, where he says he will find $22 million in annual savings by his fourth year in office. On top of that, “we will see additional new opportunities for energy retrofits, based on solid, real and measurable data.”

Unfortunately, Tory doesn’t appear ready to support a call for mandatory energy benchmarking of private commercial buildings, despite movement in this direction from city council staff and recommendations from the Toronto Atmospheric Fund. Tory feels private building owners and operators will do this voluntarily if the municipality itself shows leadership on its own buildings. This is highly doubtful. There’s a reason why cities such as New York, Chicago, Seattle, San Francisco and Washington, D.C. all require commercial buildings over a certain size to report their annual energy use, and that’s because most of them – especially the laggards – won’t do it voluntarily.

We’ve had voluntary reporting for a few years in Toronto and it can only go so far. For energy benchmarking to be truly effective as a way to find efficiencies, we need all commercial and public buildings of a certain size playing by the same rules. Here’s hoping Tory has a change of heart on this issue, and supports doing in Toronto what world-class cities south of the border are already doing, with great success.

Will He Deliver?

I know Tory reasonably well. As a technology and telecom reporter at the Toronto Star when Tory was CEO of Rogers Cable, I had many opportunities to chat with him. We kept in touch when he was leader of Ontario’s PC Party and later when he was talk show host for Toronto radio station CFRB 1010. He invited me on his show a few times to talk about energy and technology issues.

From these interactions, I can comfortably say one thing: Tory is not a No Man like Ford. He’s a consensus builder. He has opinions on various energy and environmental matters, but he isn’t dogmatic about it. He doesn’t like to throw money into a burning house. At the same time, he seems to keep an open mind, and is willing to change his position when he hears a sound argument for doing so. He’s a fiscal conservative, but he’s thoughtful enough about matters that he knows that solving social and environmental problems can’t always been done using Bay St. metrics. Sometimes situations call for patient capital. Sometimes payback can take several years. Tory appreciates this – it’s even an approach his former boss Ted Rogers took when building, at huge expense, the country’s first national mobile phone network.

This, in my view, is encouraging.

As one Toronto environmentalist told me, “Overall, this is a very solid opportunity that we should all jump on.”

We’ll learn more over the coming weeks and months. Exactly who he selects as his “environment advocate” will offer key insights, as well as who makes up his sustainable energy advisory board. Tory’s first-annual “Sustainable City Report” will tell us if he’s serious or not, as will his demonstrated willingness to push Toronto Hydro into moving more aggressively on conservation and district energy.

This editor will be watching closely.

The post Did Toronto just elect a green mayor? appeared first on Corporate Knights.

It is true that many asset managers have taken steps to integrate ESG data into the way they manage their portfolios, but the vast majority of the world’s $60 trillion in assets under management is not subject to this type of analysis.   

The mainstream’s skepticism about ESG is understandable. On a theoretical level, it is not always obvious that a good ESG performer would be a good portfolio performer. And even for those investors that are keen to explore ESG investment strategies, there are other, more practical challenges. For instance, ESG data has only been around for about a decade – a pittance in an industry that spans more than 140 years.

While this doesn’t mean that ESG analysis isn’t valuable, or that companies with good ESG performance cannot be good financial bets, it does mean that investors can’t conduct the kind of long-term financial backtests that they’re accustomed to building to evaluate new investment theses.

Another challenge is that many of the third-party vehicles that investors have historically used to integrate ESG into their portfolio decision making, including ESG ratings, are often “black boxes” – that is, they’re difficult for outsiders to break down, test and understand.  

To help investors overcome some of these barriers, Corporate Knights Capital built a new application that we call Sustainable Beta – what we believe to be the world’s first interactive sustainable portfolio construction tool. It’s not a panacea, we know, but it can help demystify sustainable investment strategies and, perhaps most importantly, it can transparently show how ESG data can be used to boost – not harm – portfolio performance.

(To test-drive Sustainable Beta, go to corporateknightscapital.com, select “Our Services” and then go to “Portfolios.”)

Users of Sustainable Beta are invited to build their own equity portfolios using five different inputs. First, select your market. Options include Australia, Canada, Europe, Japan and the United States. Next, select the specific ESG factor you would like to test. Five factors can currently be tested: Board Diversity, Carbon, Energy, Water and Tax.

Once these two fundamental decisions are made, you then decide how the portfolio should be normalized (e.g., how the ESG factor should be measured), how it should be weighted (e.g., by market capitalization or equal weight) and how often you would like it to be rebalanced (annually, semi-annually, quarterly or monthly).

After selecting all of the inputs and generating a portfolio, you can see how the portfolio would have performed against the major benchmark in your selected market (e.g., S&P 500 in the United States) from as far back as January 2008 up to the end of June 2014. 

The tool typically builds portfolios by scanning all companies that are available in the chosen market and selecting those that perform favourably on the chosen factor.  

Many of the portfolios that can be built on Sustainable Beta fail to beat their benchmark. For instance, an annually rebalanced market capitalization-weighted portfolio of Canadian carbon leaders (normalized by sales) would have underperformed the S&P/TSX Composite by 9.9 per cent from January 2010 to June 2014.  

But some portfolio permutations significantly outperform their benchmarks. For instance, an annually rebalanced, equally weighted portfolio of U.S. carbon leaders (normalized by number of employees) would have outperformed the S&P 500 by an astonishing 41 per cent from January 2008 to June 2014.

More analysis would be needed to properly attribute this outperformance – the weight scheme, for example, is sometimes a more significant determinant than the sustainability factor – but these and other results certainly call into question the orthodoxy that sustainable investing is doomed to underperform.  

Sustainable Beta is unique because of its transparency and flexibility. We are not aware of any other publicly available portfolio construction tool that lets users explore such a wide range of sustainable investment strategies. If it can play some role in the mainstreaming of ESG investing, it will have been a success.

We encourage you to give it a try.

The post Create a sustainable portfolio appeared first on Corporate Knights.

It was a historic night, with Wynne becoming the first openly gay premier elected in Canada. People simply liked the 61-year-old politician, a former community activist and school board trustee. They could connect with her. And despite attempts by opposition politicians to paint as reckless and expensive the Liberal government’s green power plan, anchored by its landmark Green Energy and Green Economy Act, voters seemed happy to stay the course rather than turn the ship around.

That Ontario’s electricity grid became coal-free in spring 2014 was symbolic of the progress made to date. Rather than coast on that accomplishment, however, Wynne is arguably accelerating the ship – at least with respect to tackling climate change, as demonstrated in her mandate letters to some cabinet ministers.

She instructed her economic development minister, Brad Duguid, to make infrastructure investments “ensuring resiliency to the impact of climate change.”

She directed her energy minister, Bob Chairelli, to make “co-ordinated efforts to improve energy efficiency and conservation, reduce greenhouse gas emissions, foster innovation in the energy sector,” and explore ways to import more zero-emission hydropower from neighbouring Quebec and Manitoba.

She also added “climate change” to the official title of environment minister, Glen Murray, who was ordered to develop a plan to reach the province’s 2020 greenhouse-gas emissions target of 15 per cent below 1990 levels, and craft a long-term climate change strategy that would guide the province into 2050. Toward that goal, Murray was told to work with other ministers in what Wynne described as an “all-of-government” approach to meeting emissions targets.

Investing in climate-friendly transportation infrastructure will no doubt be part of the solution, and on that front, Wynne’s support of Canada’s first green bond issuance demonstrated her willingness to test new approaches. This week, the province revealed that its first $500 million green bond offering was nearly five times oversubscribed. Investors from the United States, Europe, Asia, and Canada couldn’t get enough – a good sign that green bonds will be a permanent fixture in Ontario’s future.

Corporate Knights sat down with Wynne in early October to discuss her plans to put the province on a more environmentally sustainable path.

CK: What is your overall vision for “greening” Ontario?

WYNNE: I see us building on a foundation that we put in place over the last 10 years, such as shutting down the coal-fired plants and taking the equivalent of seven million cars off the road. Over 25 per cent of our greenhouse-gas emissions were from the coal-fired plants, so that’s a huge step forward. The introduction of new industries – solar and wind – again was a huge step. We need to continue to look for ways to reduce our emissions. The reason I put climate change in the environment minister’s mandate and into the name of his ministry is I want a climate change strategy – I want a mid-to-long term climate change strategy that will let us build on the foundation we have. We’re obviously not there; we still have lots to do. I guess if I had to articulate where I want Ontario to be in the context of the country, I want us to be leaders. I want to be able to demonstrate there is a way to be clean, green and sustainable, because it’s the right thing to do, but also because I don’t believe we have a choice. We all have to be part of the solution. Government has to take that leadership role.

CK: When the previous McGuinty government created the Green Energy and Green Economy Act, which subsequently spawned the province’s renewable feed-in-tariff (FIT) program, it seemed to focus more on boosting economic development and tackling urban smog. Climate change, while not ignored, was not emphasized as much and over time was discussed less and less. With you, it appears climate change is moving front and centre. What has changed in your view?

WYNNE: A couple of things have happened over the last 10 years. I think severe weather events have made it much clearer to people what it is we’re dealing with, even if you argue that there were events before 2003, which I think there were. It’s pretty irrefutable now that we better get our act together, and move as quickly as we can, and (Environment and Climate Change Minister) Glen Murray certainly feels this way.

CK: Can you explain the rationale behind your government’s recent issuance of green bonds? Do you expect more rounds down the road?

WYNNE: What is wonderful about the green bond idea is that it makes the link between building, building infrastructure and people making investment in a greener, more sustainable society. We need to do more of that. We need to do more to help people understand how we have to build protections for the environment into what we build. It’s not like we can go on building things and doing what we’ve always done for the last 50 years, and then we’ll deal with climate change later. It has to be integrated. So for me, what’s great about green bonds is it says, you know what, financial markets and investment are directly related to sustainability.

CK: Do you think citizens appreciate that link? It seems in the past, governments have tried to avoid drawing a direct line between a pool of funding and specific initiatives because it tied their hands. It also leaves them open to more scrutiny if the money doesn’t flow as promised.

WYNNE: I want to be subjected to that scrutiny. It’s why we are doing everything we can to be transparent. It’s why we released the mandate letters (to new ministers) publicly. I want to be held to the objectives we’ve put in place. If there’s something we can’t do, we have to explain why it didn’t happen. But I want to set those targets, and I want people to understand where we’re going and what our aspirations are. When you ask ‘Do the people understand that?” I don’t think we as a society have understood that. If we had, we would have built things differently, we would have had different energy policies, we would have had a different society. So we haven’t made those connections, and we’d better make them now.

CK: Ontario, since 2007, has talked openly about participating in a regional cap-and-trade program for greenhouse-gas emissions. It has been quiet on that front for the past few years. Is cap-and-trade, or some sort of carbon pricing, on your government’s agenda?

WYNNE: I’ve asked Glen (Murray) to put together a climate change strategy. What I can tell you is we know we have to take more action in terms of our greenhouse-gas emissions. Exactly how that will look, I don’t know. I’ve had a conversation with (Quebec Premier) Philippe Couillard and I know he’s moving very aggressively in terms of cap-and-trade and working with California. I don’t have the detailed answer for you at this point, but are we committed to taking the next step? Absolutely.

CK: Do you have a personal preference regarding carbon-pricing approaches?

WYNNE: I’m going to let that discussion unfold in the government. I think we are all in the discussion of carbon pricing. Even (Prime Minister) Stephen Harper, who doesn’t want to take clear action, is part of the discussion of carbon pricing whether he wants to be or not. It’s a survival question.

CK: Does it bother you that the federal government takes credit for the coal plant closures in Ontario as a sign of federal progress on reducing greenhouse-gas emissions?

WYNNE: It’s disingenuous. It’s political, because they don’t have anything else to talk about, really. But the reality is every premier across the country is thinking about the issue. Jim Prentice (the new Alberta Premier) is thinking about it vis-à-vis the oil sands. Christie Clarke (the B.C. Premier) is thinking about it, and she’s got a carbon tax in place already. Even if Stephen Harper doesn’t want to have the active discussion, all the premiers in this country are having this discussion, so de facto he’s part of it.

CK: With the coal-plant closures, Ontario can more credibly market itself as a clean energy economy. (Note: About 85 per cent of the electricity Ontario generated in 2013 could be characterized as emission-free). Is the province doing enough to promote itself as a place to build stuff with low-emission electricity?

WYNNE: I think there’s more we can do. Marketing ourselves as a clean energy jurisdiction is absolutely something that can be a selling point for us, and we haven’t done as much as we could.

CK: Following along that line of thinking, should the province be taking a more holistic approach to economic development by looking at energy, transportation and economic development in a more integrated way, rather than separately within the bureaucratic silos of each responsible ministry?

WYNNE: Absolutely. It’s one of the hardest things I have found in government – getting the walls between the ministries to be broken down, and having people work together. Again, that’s another reason the mandate letters (to ministers) were so important to me, because they all talk about working across ministries. And it’s not just about co-signing cabinet submissions, it’s about actually having officials and ministers work together and come up with solutions with the bureaucracy that are looking at a problem from different angles. I’m pushing very hard on that and it’s what I believe has to happen. I’m not coming at this saying do something I didn’t do myself. That’s actually how I worked as a minister. I know it can be done, but it takes political will. It takes the ministers to say, we’re going to sit at this table and have the conversation with all three ministries here and we’re going to come up with a combined solution. If that doesn’t happen, then it’s very hard for the bureaucracies to look sideways and see what their colleagues are doing.

The post A Wynne for the climate? appeared first on Corporate Knights.

The Montreal Carbon Pledge launched today at the PRI conference in Montreal, which will encourage institutional investors to measure and publicly disclose how much carbon is contained within their investment portfolios on an annual basis.

The pledge adds to existing measurement tools, reporting standards and low-carbon investment options that have created a “perfect storm” for building a low-carbon economy, says Toby Heaps, Chief Executive Office of Corporate Knights.

This comes only days after Ban Ki-Moon, Secretary General of the United Nations, called on the private sector at Tuesday’s Climate Summit in New York City to “redirect investment commensurate with the scale of the challenge,” including disclosing carbon asset exposure.

“Climate change is a risk to businesses and financial markets everywhere,” said Ki-moon on Tuesday. “It threatens to undermine financial resilience, and efforts to alleviate poverty and maintain sustained economic growth.”

While he said carbon pricing was a critical first step, it would be insufficient if not complemented by urgent direct action. And with over $75 trillion (U.S.) in investable assets, institutional investors play a leading role in the transition to a climate resilient economy.

That is why the Montreal Carbon Pledge is aiming to get commitments from portfolios worth $3 trillion before the United Nation climate meeting in Paris in December 2015.

The PRI – an international network of investors supported by the United Nations, which represents more than $45 trillion (U.S.) in assets under management – will manage the online portal where investors can endorse the Montreal Carbon Pledge, report the size of their portfolio’s carbon footprint and list their carbon-reduction targets.

These actions will not only help to mitigate the climate crisis, they also have the potential to generate new markets and new employment opportunities, as well as generate economic growth while meeting our social and environmental needs, said Ban Ki-moon on Tuesday. But, in order for this to happen, investors need to enter a new era of global cooperation, he said.

The Montreal Carbon Pledge will bring institutional investors together so that they can “translate climate talk into walk,” said Fiona Reynolds, Managing Director of the Principles for Responsible Investment in a statement.

The post Investors cooperate on climate appeared first on Corporate Knights.