Our Net-Zero Commitment

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What the future holds remains uncertain.

Climate change is here. We have to think and act differently.

Climate change creates not only significant risks, but also opportunities for the companies and investors that adjust to a net-zero reality.

The CPP Fund’s performance will be influenced by how well CPP Investments adapts to the global economy’s transition to net zero.

That’s why we’ve committed our portfolio and operations to being net zero of greenhouse gas (GHG) emissions by 2050.

Our commitment is made on the basis and with the expectation that the global community will continue to advance towards the goal of achieving net-zero GHG emissions by 2050.

To achieve net zero, the world needs to advance towards:

The acceleration and fulfillment of commitments made by governments

Technological progress

Fulfillment of corporate targets

Changes in consumer and corporate behaviours

Further development of global reporting standards and carbon markets

These advancements are a global effort and we play a role.

We are investing in the transition

Invest in green and transition assets.

We are active owners and partners

Active ownership and decarbonization investment approach.

We are adapting too

Carbon neutral in our internal operations.

We are investing in the transition We invest in both green and transition assets.

We invest in industry leaders in sustainability - supporting these leaders while they support an economy-wide transition.

We are increasing our investments in green and transition assets – from $66 billion in FY2022 to at least $130 billion by 2030.

So, what are green and transition assets?

GREEN ASSETS

CPP Investments has a high threshold for green assets, they have to get at least

%

of their revenue from green sources.

Such as:

Renewable energy
Clean transportation
Green certified buildings

TRANSITION ASSETS

They are companies that either

Don’t yet receive the majority of their revenue from green sources.

They fall short of the 95% threshold to be considered a green asset.

Are in high-emitting sectors with decarbonization plans.

Their plans must be validated by a credible third-party for target setting, such as the Science Based Targets initiative (SBTi) or disclose details of their decarbonization to show it is viable and profitable.

Transition assets have committed to reaching net zero with credible targets and transition plans in place.

These are more than just numbers on a page. Companies we invest in can have real world impact.

Learn about some of the green and transition companies in our portfolio:

green asset

Cordelio Power is an independent power producer that develops, owns and manages renewable power facilities. Cordelio manages an operating portfolio of over 1,200 megawatts of renewable assets across North America, including 396 megawatts of wind and solar projects in Ontario. CPP Investments supports Cordelio’s mission of becoming a leading North American developer, owner and operator of renewable power facilities.

green asset

Octopus Energy is a global energy and technology company headquartered in the U.K. It operates several businesses in 15 countries across four continents. Through its energy platform, Kraken, Octopus supports 32 million customers and is the largest renewables investor in Europe. CPP Investments is a long-term strategic partner of Octopus, supporting its mission to accelerate the transition of energy assets globally and to help expand green energy generation.

transition asset

Ørsted is a Danish company that develops, constructs and operates offshore and onshore wind farms, solar farms, energy storage facilities, renewable hydrogen and green fuels facilities, and several biomass-fired combined heat and power plants. In 2021, Ørsted became the first energy company in the world with a science-based net-zero target and plans to be net zero by 2040.

We are active owners and partners We want to help our portfolio companies and partners adapt.

CPP Investments has many different types of companies in its portfolio.

Each one of them must embark on their own decarbonization pathways and we act as engaged owners along the way.

Our active engagement and proxy voting hold public companies accountable and can encourage them to consider climate-related risks and opportunities in new and innovative ways. This can lead to better returns and reduce risk when companies take a more proactive position on climate in their strategy.

Diagram with green and purple circles providing an illustrative example of initiatives in which CPP Investments votes its proxy.

But voting is not our only tool.

As owners, we:

We are adapting too We maintain carbon neutrality across our internal operations.

We track our Scope 1, 2 and 3 (like business travel) emissions and are committed to get them to net zero.

Scope 1

Direct GHG emissions from an organization’s owned and controlled sources.

Scope 2

Indirect emissions from the generation of purchased energy.

Scope 3

All indirect emissions (not included in Scope 2) that occur in the value chain of the reporting company.

We have already achieved carbon neutrality for the fiscal year 2023.

For the emissions we haven’t yet been able to reduce, we offset with high quality, verifiable carbon credits from the Darkwoods Forest Carbon Project.

Operational Emissions

Total GHG emissions (tonnes of CO₂e)

18,323

Covid-19 pandemic

Carbon credits

13,526

4,113

2,303

FY20

FY21

FY22

FY23

Carbon neutral

Darkwoods spans 63,000 hectares of remote valleys, mountains and lakes, providing essential habitat for dozens of species at risk in British Columbia.

However, we still have more work to do, to lower our overall emissions footprint.

To move from carbon neutrality to net zero we are lowering our operational emissions by modifying air travel, modernizing office spaces and changing behaviours.

The world and CPP Investments’ path to net zero is filled with uncertainty and possibility.

We recognize that our portfolio’s emissions are likely to increase in the near term.

Because instead of removing emissions from our portfolio and leaving them for someone else to deal with, we aim to generate investment returns by removing them from the global economy all together.

We believe this is a vital step in the global economy’s transition to net zero. We are committed to our approach.

Stewarding the portfolio to net zero will generate long-term returns and help us manage the Fund in the best interests of the contributors and beneficiaries of the Canada Pension Plan.

We act as long-term investors in companies across sectors as they map a course to a more sustainable and competitive future.

Including in high-emitting sectors where it is especially hard to reduce emissions, like oil & gas and agriculture.

This takes time.

We expect this approach will create value and minimize risk to the Canada Pension Plan Fund. Who better to fund and benefit from the decarbonization of sectors Canadians need, than an investor like us? An investor with global reach, public purpose and a generational investment horizon.

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