OPTrust releases enhanced climate change strategy
Strategy includes action plan to achieve net-zero portfolio by 2050Posted: October 25, 2022
TORONTO, October 25, 2022 – Today OPTrust released its enhanced climate change strategy. The strategy outlines how OPTrust will manage risks and opportunities from a transitioning economy and declares OPTrust’s ambition to align its portfolio with the global path towards net-zero emissions by 2050.
As the world grapples with the growing challenge of climate change, investing sustainably for the long-term health of our pension plan demands addressing climate sustainability," said Peter Lindley, President and Chief Executive Officer at OPTrust. "Our climate change strategy commits to a net-zero portfolio by 2050 and to building the foundation that enables us to embed climate considerations into the way we invest."
OPTrust aims to achieve a net-zero portfolio by 2050, based on the expectation that global progress and momentum continues towards achieving net-zero greenhouse gas emissions over that timeframe. The enhanced strategy is built on four pillars designed to integrate climate considerations across OPTrust’s investment portfolio and operations: investment strategy and selection, asset management, portfolio analytics, and advocacy and disclosure.
2022-23 priorities include:
- Updating climate scenarios and examining implications to OPTrust’s investment approach, including continuing to advance its pioneering research into the impact of climate on pension assets and liabilities.
- Collecting baseline data on climate metrics for OPTrust’s portfolio and establishing a framework to set appropriate, relevant targets.
- Launching climate due diligence frameworks for use by investment teams across all asset classes.
- Implementing stewardship plans to advance the transition of high-risk assets.
- Continuing to join global peers in advocating for progress on climate policies.
- Continuing to report on our progress, including through our annual Funded Status Report and Taskforce for Climate-related Financial Disclosures.
"Our climate change strategy outlines a clear ambition and approach to align our portfolio with the global path to net zero," said James Davis, Chief Investment Officer at OPTrust. "As a long-term investor, we aim to understand and mitigate emerging risks, including from climate change, as well as recognize and harness opportunities that come along with the transition to a greener economy. With this climate change strategy in place, we will continue to focus on enhancing our portfolio’s resiliency across asset classes now and into the future."
With net assets of over $25 billion, OPTrust invests and manages one of Canada's largest pension funds and administers the OPSEU Pension Plan (including OPTrust Select), a defined benefit plan with over 100,000 members. OPTrust is a global investor in a broad range of asset classes including Canadian and foreign equities, fixed income, real estate, infrastructure and private markets, and has a team of highly experienced investment professionals located in Toronto, London and Sydney.
Director, Public Affairs