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Sustainable Investing

We believe that organizations that manage Environmental, Social and Governance (ESG) factors effectively are more likely to create sustainable value over the long term than those that do not. As we work to fulfill our mandate, we consider and integrate ESG risks and opportunities into our investment decisions.

At CPP Investments we consider responsible investing simply as intelligent long-term investing. Over the exceptionally long investment-horizon over which we invest, ESG factors have the potential to be significant drivers – or barriers – to profitability and shareholder value. For these reasons we refer to what many call ‘Responsible Investing’ activities simply as Sustainable Investing.

Given our legislated investment-only mandate, we consider and integrate both ESG risks and opportunities into our investment analysis, rather than eliminating investments based on ESG factors alone. As an owner, we monitor ESG factors and actively engage with companies to promote improved management of ESG, ultimately leading to enhanced long-term outcomes in the companies and assets in which 20 million CPP contributors and beneficiaries have a stake.

CPP Investments has established governing policies, approved by our Board of Directors, to guide our ESG activities. Our Policy on Responsible Investing establishes how CPP Investments approaches ESG factors within the context of our sole mandate to maximize long-term investment returns without undue risk of loss. Our Proxy Voting Principles and Guidelines  provide guidance on how CPP Investments is likely to vote on matters put to shareholders and communicate CPP Investments’ views on governance matters.

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2019 Sustainable Investing Report

Investing for CPP Contributors and Beneficiaries

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President’s Message

CPP Investments received its first dollar to invest two decades ago. Milestones like these provide opportunities to reflect on the factors that help an organization achieve its goals, but also consider disruptive challenges that must be addressed to ensure future progress.

Our Approach to Sustainable Investing

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Engagement

We seek meaningful engagements with our portfolio companies by having informed dialogue about ESG disclosure and practices, monitoring corporate activities and exercising our ownership rights.

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Integration

Our Sustainable Investing group works directly with our investment departments to ensure that risks and opportunities stemming from potentially material ESG factors are integrated into investment decision-making processes and asset management activities organization-wide.

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Collaboration

We collaborate with like-minded organizations to engage with companies, encourage better environmental, social and governance-related practices and advocate for long-term policies and actions to reduce risks and promote value-building growth.

CPP Investments' Focus Areas

Climate Change

Climate change can present material financial risks and opportunities for companies and impact long-term investment values.

Water

Effective management of water supply, use and quality is fundamental to the long-term sustainability and operations of many companies.

Human Rights

Human rights are relevant from an investment perspective because human rights are key to building long-term sustainable value, and when not appropriately managed can lead to operational disruptions and reputational issues.

Executive Compensation

Clear and appropriate links between executive pay and company performance contribute to alignment of the interests of management and long-term investors. When these interests are properly aligned, long-term shareholder value is more likely to be created.

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Board Effectiveness

Board effectiveness is one of the most important topics in corporate governance. Having the right board in place to help guide strategy and oversee risk is critical to the long-term value of our investee companies.

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