Weather. It was a Canadian obsession even before “wind chill factor” and “humidex” became part of our everyday vocabulary. In donut shops, elevators and at water coolers across the nation, you’re likely to overhear Canadians participating in the national pastime:

“Cold enough for ya?”

“Don’t like the weather? Wait five minutes.”

“Yes, but it’s a dry heat.”

With the doses of bizarre weather we’ve experienced across the country over the past few months, combined with mounting scientific evidence that climate change is a reality, those water cooler conversations have taken on a new urgent tone.

In fact, the environment overtook healthcare as the top issue in Canada, according to a survey conducted in mid-January for The Globe and Mail and CTV. Twenty-six per cent of respondents rated it the most important issue facing the country.

What, you might ask, does all this have to do with my pension plan? Well, it’s only a matter of time before the investing practices of pension plans— among the largest investors in the country—are put under the environmental microscope. In fact, Canada’s 13,800 registered pension plans were the target of a report released last month by the National Roundtable on the Environment and the Economy. The report accuses pension plan trustees of being driven primarily by “narrow, short-term financial criteria” when making investment decisions about plan assets, while often ignoring environmental, social and governance(ESG)factors.

“Many fiduciaries in Canada continue to feel that consideration of ESG factors is in general conflict with their fiduciary duty,” states the report. This approach, however, may “belie the lack of appreciation for the highly material nature of many ESG issues, such as diminishing ecological services, decreasing natural resources and increasing social unrest, among others.” In fact, the Roundtable argues that not considering these factors may actually be a breach of fiduciary duty.

Among the Roundtable’s recommendations are those calling for regulations requiring pension plans to disclose the extent to which they took ESG considerations into account when selecting investments. It also recommends that governments and regulators enact guidelines or regulations “to clarify that the fiduciary obligation of the trustee includes the consideration of ESG issues that are financially material to investment decisions.”

With environmental issues at the top of Canadians’ priority list, the major political parties are scrambling to position themselves as being greener than the other guys. So these are just the type of recommendations that might catch their eye. Pension plans would be wise to take a second look at their investment policies with an eye to ESG issues—before the weather becomes policymakers’ new obsession.

Don Bisch don.bisch@rci.rogers.com

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