We know that ESG factors, such as climate change, will fundamentally influence the long-term sustainability of financial markets. With a systems-level view, we account for these factors at every stage of the investment process to better derive and protect value for members, in line with our fiduciary duty. This includes working with our external investment partners and industry peers to continuously improve performance in these areas and reinforce the health of the capital markets on which our fund relies.
ESG refers to environmental, social, and governance factors that may impact or be impacted by corporate or investment activities.
Every investment professional is responsible for considering the economic impact of material ESG factors in their investment decision-making and for clearly communicating our related policies and expectations to our investment partners.
Our investment policies provide a framework for how we will consistently and comprehensively incorporate ESG considerations in our investment management and stewardship activities. These policies will continually evolve as we grow and advance our investment program, driven by our steadfast commitment to the pension promise. All of this is informed by our long-term investment beliefs.
Our Climate Action Plan outlines the steps and tools we will take to achieve our net-zero target and manage climate-related investment risks and opportunities, while helping drive the broader global transition to a resilient net-zero world. UPP will transition our investment portfolio to:
GHG emissions by
With interim carbon footprint reduction targets from a 2021 baseline (tCO2-eq/$M invested):
16.5% by 2025
60% by 2030
The Action Plan speaks to two deeply connected objectives for UPP:
We see this commitment as central to delivering long-term value, and an essential beacon for our evolving investment strategy.
As a shareholder in publicly traded companies, UPP has the right to vote on items of importance at annual and special company meetings. We exercise our proxy voting rights to communicate expectations and hold publicly traded companies accountable on their ESG practices. Our Proxy Voting Policy clearly states our positions and expectations on an array of issues focused on enhancing the long-term economic interests of shareholders, including our ESG expectations.
We participate in direct and collective advocacy with policymakers, regulators, and within the financial sector to encourage fair and efficient public policy, regulations, and market systems that support a well-managed transition to a net-zero world and UPP’s broader sustainability objectives. Examples:
We selectively collaborate with investors and organizations at the national and global level to enhance the impact of our engagement and advocacy, including our efforts to influence industry practices and norms, and promote market-wide sustainable standards and practices.
Partnerships also enhance our access to global tools, research, networks, training, and other resources from peer investors, which help advance best practices within our own operations, with the costs shared across the collective.
In general, as a first course of action to influence investee behaviours and effect change, we favour active engagement and constructive dialogue over excluding or selling investments. However, our principles-based investment exclusion policy and sector general parameters set out the companies we will not invest in if:
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