The 20 largest provincial pension funds in Canada are exposed to a “wide range of risks” associated with their fossil-fuel holdings, said a report Tuesday by the Canadian Center for Policy Alternatives.
The holdings of the 20 plans, which have a total of C$668 billion ($501 billion) in assets, have sustained a combined C$5.8 billion in losses because of recent declines in energy prices, according to the CCPA report. The plans’ holdings ranged from 4% to 9% of assets, valued at about C$27 billion.
Along with commodity price risk, the report said the plans face other risks such as energy innovation, carbon liability and external political risk, including the rejection this month by the U.S. of the proposed Keystone XL pipeline.
“It is our impression that Canadian pension funds are living in a form of climate denial,” said the report’s author, Marc Lee, CCPA senior economist, in a news release accompanying the report.
The full report, “Divestment from fossil fuels is consistent with fiduciary duty,” is available on the CCPA’s website.