By Alastair Sharp
Norway’s municipal employees’ pension fund, the country’s largest, has sold its last remaining stakes in companies with operations in Canada’s oilsands, saying holding them does not align with efforts to keep global heating below internationally agreed-upon targets.
The fund, Kommunal Landspensjonskasse (KLP), last year dumped stocks that drew more than 30 per cent of their revenue from oilsands operations, but on Monday said they can no longer tolerate even those that have five per cent exposure.
KLP, which manages the pensions of Norway’s 900,000 nurses, firefighters and other employees of local governments and state-owned enterprises, said in a statement that it had jettisoned US$33 million worth of equity holdings and US$25 million in bonds from Canada’s Cenovus Energy, Suncor Energy, Imperial Oil (majority-owned by ExxonMobil) and Husky Energy, as well as Russia’s Tatneft PAO.
Jeanett Bergan, head of responsible investments at KLP, said in a phone interview that “the message we really would like to get across is that companies and fund managers and investors all need to start managing this risk and making sure that they’re doing everything they can to be part of the transition that all societies need to do.”
Norway, much like Canada, has a sizable oil and gas industry that creates economic activity but also contributes to unsustainable levels of global carbon emissions. The oil and gas sector in Canada is the largest contributor to the country’s carbon pollution profile, contributing over a quarter of all emissions, or 27 per cent according to federal estimates.
“From the emission numbers and everything that is happening around the world, nothing is moving fast enough,” Bergan said. “We’re not close to the 1.5 degrees (Celsius) target, we’re not close to the 2-degree target. We’re far from it,” she said, referring to commitments made as part of the Paris Agreement, signed in 2016, to keep global warming from rising more than 1.5 or 2 C above pre-industrial levels.
Canada Pension Plan board looking at fund’s pollution
Global temperatures have so far risen roughly 1 C since humans began building factories and using mechanized manufacturing techniques more than 200 years ago. Human activity, such as the burning of fossil fuels has caused all planetary heating since midcentury.
The Canada Pension Plan Investment Board (CPPIB), a Crown corporation, manages over $400 billion including hundreds of millions of dollars worth of oil and gas companies such as Enbridge ($385 million), Suncor ($240 million) and Pembina Pipeline ($95 million).
The corporation could not say whether it was considering axing its fossil fuel holdings when contacted by National Observer. It also does not have a stated, specific plan to cut exposure to companies of a certain emissions intensity.
In fact, the fund has just started to ask the question of how much carbon pollution its holdings emit at all.
CPPIB’s 2018 sustainability report looked at 34 per cent of total holdings, the fund’s stake in each emitting company, and determined it emitted 15.6 million tonnes of carbon dioxide equivalent (125 tonnes of CO2e per C$1 million invested and 220 tonnes of CO2e per C$1 million of revenue).
The fund says it has created tools to allow its investment teams to assess climate change risks and opportunities and also published details on the carbon footprint of its public equities portfolio for the first time in that 2018 report.