The New York State Pension Fund said on Monday it would restrict investment in six Canadian oil sands companies “that have not shown they are prepared for the transition to a low carbon economy “.
Blacklisted Canadian companies include Imperial Oil (IMO.TO) (IMO), Canadian Natural Resources (CNQ.TO) (CNQ), Husky Energy, MEG Energy (MEG.TO), Athabasca Oil (ATH.TO) and Cenovus Energy (CVE.TO) (CVE). Japan Petroleum Exploration (JP9.F) was also included in Monday’s announcement. The fund said these companies “have failed to show that they are getting out of oil sands production.”
The New York State Pooled Retirement Fund has said it will also sell more than US $ 7 million in securities of these companies as it assesses its holdings in the oil sands. New York is the third largest public pension fund in the United States, ending last year with approximately US $ 247.7 billion in assets.
“As nations around the world take tackling the threat of climate change more seriously and market forces drive a low-carbon economic transition, we need to ensure that our investments match this reality,” New York State Comptroller Thomas DiNapoli said. in a report.
He added that the move comes after careful consideration of Canada’s oil sands industry, which has been deemed “more expensive and carbon intensive than other forms of crude production.”
The decision to exclude some of Canada’s most important energy players was part of DiNapoli’s broader review of the readiness to transition energy sector investments facing climate risk. Last year, the fund withdrew from 22 coal companies. Shale oil and gas companies will then be assessed.
The New York State Pension Fund has pledged to curb climate change by reshuffling its investments to net zero greenhouse gas emissions by 2040.
This is not the first fund to target Canada’s energy industry because of its environmental track record. Last May, Norges Bank Investment Management (NBIM), a branch of the Norwegian central bank, said it was excluding Canadian Natural Resources, Cenovus Energy, Suncor Energy (SU.TO) (SU) and Imperial Oil due to “Unacceptable greenhouse gas emissions. “
Prime Minister Justin Trudeau said at the time that the Norwegian US $ 1 trillion fund’s decision underscored the growing importance of climate change risk for global investors.
“We have seen investors around the world view the risks associated with climate change as an integral part of the investment decisions they make,” Trudeau said at a press conference in May.
“It is so important for Canada to continue to move forward in the fight against climate change and to reduce its emissions in all sectors. I can point out that many companies in the energy sector have understood that the investment climate is changing and that there is a need for clear leadership and clear goals to be achieved in the fight against climate change to tap into global capital.
Jeff Lagerquist is a senior reporter at Yahoo Finance Canada. Follow him on twitter @jefflagerquist.
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