Young Claimants Sue CPP over Climate Risk Management
A groundbreaking lawsuit has been filed for the first time against a Canadian investor, the Canada Pension Plan Investment Board (CPP Investments), over its failure to properly assess and disclose climate-related risks.
Four young plaintiffs initiated legal action in Ontario Superior Court, accusing CPP Investments of neglecting its legal duty by subjecting pension contributions to excessive risk caused by climate change.
Legal Arguments Focus on Financial Climate Risks
Karine Peloffy, a lawyer at Ecojustice and co-counsel on the case, explains:
“It is really about financial risks of climate change. It’s not about being nice, it’s not about politics, it's not about appearances. It’s about the actual legal obligation to manage the material risks of climate change.”
Risk to Retirement Funds of Younger Generations
The plaintiffs emphasize that by underestimating and failing to reveal the dangerous consequences of climate change, CPP Investments endangers the retirement savings of younger contributors, including themselves, who expect to retire around 2050.
Notably, CPP Investments removed its 2050 net-zero emissions target last May, distancing itself from the broader climate commitment many organizations have adopted.
Potential Impact on Investment Fund Policies
Legal experts view the case as a potential precedent for how major investment funds must incorporate and disclose climate risks in their decision-making and reporting processes.
Author’s Summary
This lawsuit challenges a major Canadian pension fund over its climate risk policies, potentially reshaping how investment boards legally manage and disclose climate-related financial risks to protect future retirees.