OPTrust releases 2018 Responsible Investing ReportReport marks year-one results of the fund’s Climate Change Action PlanPosted: May 14, 2019
TORONTO, May 14, 2019 – OPTrust today released its 2018 Responsible Investing Report, which details the Plan’s RI results and philosophy directing the integration of environmental, social and governance (ESG) factors into its investment strategy. The fund also shared the tangible progress made in measuring total fund exposure to climate risk during the first year of reporting on its climate action framework and year two reporting in line with the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.
This year, OPTrust joined the Investor Leadership Network to promote gender diversity, develop infrastructure investment in emerging economies and improve financial reporting related to climate change. In response to its divestment from public market tobacco firms the previous year, OPTrust endorsed the Tobacco-Free Finance Pledge, among other advocacy priorities outlined in the report.
“Our members need to know they can count on their pension to be there when they retire. With an investment horizon that spans several decades, we cannot ignore ESG factors that could affect our performance,” said James C. Davis, OPTrust’s Chief Investment Officer. "Our responsible investing strategy is aligned with members’ interests to keep the Plan fully funded at the lowest risk level while recognizing global events and market forces.”
OPTrust’s RI philosophy is applied across the fund’s globally diversified portfolio that creates long-term value for the Plan. Regardless of the investment size and type – roads, railways, office towers or renewable energy – the impact of material ESG issues are considered as part of the due diligence process for every investment decision.
“As long-term investors, we are very mindful of slow rising risk factors such as climate change that often get missed by short-term investors,” said Davis. “We’re at the beginning of our climate journey. However, our goal is to reduce climate risk exposure without negatively impacting the fund today and years in the future. ”
Launched in June 2018, OPTrust’s Climate Change Action Plan seeks to build climate risk into its investment approach making the fund more resilient over the long-term. Actions include defining a clear baseline to measure the pension plan’s exposure, considering climate risk factors when assessing investments and pushing for increased disclosure of climate change-related information from portfolio companies, among others.
More detailed information about OPTrust's responsible investing strategy, highlights and response to the TCFD recommendations is available in Leading Change. Driving Value.
With net assets of almost $20 billion, OPTrust invests and manages one of Canada's largest pension funds and administers the OPSEU Pension Plan, a defined benefit plan with almost 95,000 members and retirees. OPTrust was established to give plan members and the Government of Ontario an equal voice in the administration of the Plan and the investment of its assets through joint trusteeship. OPTrust is governed by a 10-member Board of Trustees, five of whom are appointed by OPSEU and five by the Government of Ontario.
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