Sustainable Investing

• First sustainable energy investment

• Introduction of responsible investing principles

• Established Proxy Voting Guidelines

• Real Estate carbon reduction target established

• Oxford publishes first sustainability report

• Founding member of A4S

• 30% Club commitment

• Founding ILN Partner

• Board approved Sustainable Investing Framework

• SI Committee convened

• Dedicated VP of SI joins OMERS

• Endorsed TCFD and issued first TCFD report

• Launch of new SI website

• Maturing ESG integration processes

• Calculated first portfolio carbon footprint

• Established first Carbon Reduction Goal for 2025

• Announced Net Zero 2050 goal

• Conducted climate change scenario analysis

• Founding partner Climate Engagement Canada

• ESG Scorecards in place for all BUs

• Further TCFD Implementation

• Define 2030 reduction goal

• Explore climate physical risk assessment

Sustainable investing, sometimes referred to as ESG investing, integrates environmental, social and governance factors into investment decisions. Sustainable investing is based on the belief that companies’ efforts to address environmental risk, foster positive relationships with stakeholders and implement effective governance structures that promote responsible business practices are key determinants of long-term performance.

At OMERS, our core strategy is to deliver sustainable, affordable and meaningful pensions to our members. We believe that well-run organizations with sound ESG practices will perform better, particularly over the long term, and that investing in these companies is consistent with our fiduciary duty.

Our approach to sustainable investing involves incorporating an adaptive mindset, enabling us to dynamically manage risks and capitalize on opportunities in a constantly changing environment, employing the following principles:

Integration: of material ESG factors into our investment analysis, providing a holistic view of value and risk

Collaboration: with like-minded partners, to influence change and contribute to the health of global financial, economic, social and other systems that are critical to our future success

Engagement: of our members’ capital, engaging with companies to influence positive change, enhance value and drive tangible outcomes, in line with our long-term focus

Our Sustainable Investing Policy can be found here.

We believe the world is transitioning to a lower-carbon economy, the pace and scope of the change will largely be determined by government policies, innovation and technological disruption/adoption. As long-term investors, we see significant opportunities to invest in clean energy and our portfolio is shifting to reflect this.
 
While OMERS continues to carefully and selectively invest in traditional energy assets as part of a balanced and diverse energy portfolio, clean energy is a significant and growing part of our strategy. Our commitment to clean energy is reflected throughout our portfolio, including through the achievements of our real estate arm, Oxford Properties which is ranked in the top 3% globally for sustainability and through our investments in Environmental Resource Management (ERM), Bruce Power, Arctern and Leeward Renewable Energy.

We believe that as the world transitions to a lower-carbon economy, there is a vital role for responsible, long-term investors such as OMERS to provide leadership on the cleaner and safer production and transportation of traditional energy. Today, we believe that traditional energy assets still form part of a balanced and diverse energy portfolio, and that to divest completely from traditional energy would mean that we lose our voice, and influence, in a very significant portion of the energy market. We use our influence as investors to help ensure that the traditional energy companies we have ownership positions in adopt a proactive approach to creating long-term, effective, relevant and transparent ESG strategies.

Any industry or sector exclusions are determined based on a set of criteria approved by our Senior Executive Team that consider risks posed by ESG factors, as well as OMERS fiduciary duty.
We believe that investments in companies engaged in the following activities meet those criteria, and therefore do not meet our risk-return requirements:

• civilian firearms manufacturers;

• cluster munitions and anti-personnel landmines manufacturers; and

• tobacco producers and manufacturers.