Climate Stewardship Plan

Engagement

We have selected 27 companies across three categories as the focus of our engagement activities: banks as important allocators of capital that will shape climate transition, high-emitting Canadian companies where UPP engagement can add value, and oil companies with an outsized impact on UPP’s carbon footprint. When selecting companies we considered:

• company size and weight in UPP’s investments,

• opportunities for engagement,

• materiality of the companies to UPP’s carbon footprint,

• importance of the companies to real economy climate transition, and

• availability of metrics and data to measure progress.

Our engagement goals and approaches for each of the three company categories are outlined below.

Proxy voting

As a shareholder in publicly traded companies, we use our voting rights to communicate expectations and hold companies accountable on governance issues, including those related to climate change.

Our Proxy Voting Policy states our positions and expectations of companies in the form of guidelines on important ballot issues focused on enhancing the long-term economic interests of shareholders. Our votes are publicly disclosed on our proxy voting page.

Goals

Through the proxy voting-related actions in this Plan, we seek to:

1. Focus our votes on climate performance in addition to disclosure.
2. Amplify the impact of our votes through communication.

Action Plan

2023: Initiate votes against directors

• Vote against all incumbent directors where there appears to be little to no board oversight of climate-related issues.
• Write to Canadian companies when we vote against management recommendations for climate-related reasons.
• Propose revisions to our guidelines and process to enable voting against directors on inadequate evidence of climate action.

2024: Escalate with strengthened guidelines

• Share updated proxy voting guidelines with all external managers.
• Execute votes in accordance with the revised guidelines.
• Write to climate engagement focus companies and Canadian companies when we vote against management recommendation for climate-related reasons.
• Consider revisions to our guidelines to integrate climate-related expectations on other ballot items such as auditor appointment, advisory votes on compensation, and corporate transactions.

2025: Communicate votes to amplify impact

• Systematically highlight our climate-related vote guidelines to external managers.
• Execute votes in accordance with the revised guidelines.
• Pre-declare votes for one or more climate-related ballot item.
• Write to climate engagement focus companies, Canadian companies, and select international companies when we vote against management recommendation for climate-related reasons.
• Consider further refinement of our guidelines and approach.

We believe that UPP has a duty to advocate for effective rules and regulations on behalf of our members for the good of the fund and for the good of the economic, social, and environmental systems on which long-term fund performance relies.

Effectively managing a systemic issue like climate change requires market regulation to facilitate and incentivize behaviour consistent with addressing the challenge. UPP selectively communicates with regulators and policymakers—either independently or with like-minded peers—to encourage fair and efficient public policy, government regulations, and market systems that support a well-managed transition to a net-zero world and UPP’s broader sustainability objectives.

Goals

Through our climate policy advocacy, we aim to:

1. Contribute to establishment of mandatory standardized, economy-wide disclosure of scope 1, 2 and material scope 3 emissions, and transition plans from all medium and large enterprises.
2. Support policy advancing the alignment of activity in the real economy with a 1.5 degrees scenario.

Advocacy approach

We will advocate for the regulatory interventions necessary to ensure near complete coverage of Canada’s economy with climate-related financial disclosures. UPP will also support development of a Canadian green and transition taxonomy and the domestic adoption of the International Sustainability Standards Board standards. Where capacity permits UPP will support industrial policy that facilitates real economy transition and express concern with policies that are misaligned. In doing so UPP will refrain from partisanship or statements that could be perceived as partisan.

UPP will prioritize advocacy on policy issues in Canada. However, we will monitor and from time to time may provide input to international regulatory frameworks and standards where we believe that our voice will have meaningful impact, including by actively participating in collaborative investor action networks and initiatives .