Noah Zivitz

Managing Editor, BNN Bloomberg

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Canada's largest pension fund is vowing it won't rely on "blanket divestment" to meet its goal of achieving net-zero greenhouse gas emissions.

Canada Pension Plan Investment Board (CPPIB), which had $550.4 billion in assets as of Dec. 31, announced on Thursday it intends be net-zero in all respects by 2050, and will make its internal operations carbon neutral by 2023.

The ambition could have sweeping implications for CPPIB's global investing strategy. In a release, it signalled that it will be using the power of persuasion, rather than just dumping stocks that don't meet its needs.

"[CPPIB] will continue to invest in and exert our influence in the whole economy transition as active investors, rather than through blanket divestment," it said.

By contrast, the Caisse de dépôt et placement du Québec said September it would exit its exposure to oil production by the end of 2022, stating that it wants to "avoid contributing" to growth in crude supply.

CPPIB added that it will almost double its investments in green and so-called “transition assets” to least $130 billion from $67 billion by the end of this decade.

"The impacts of climate change on the investment landscape are undeniable and have fundamentally transformed the nature of business risks and opportunities. As a capital provider and partner, and with our experience, expertise and financial resources, we recognize the valuable contribution we can make to this challenge," said CPPIB President and Chief Executive John Graham in a release.

Separately, CPPIB said its fund posted a 2.4 per cent return in the fiscal third quarter, which ended Dec. 31.