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Canada pension funds with combined $1.2 trillion under management ask companies to standardize ESG reporting

A wind farm generates electricity near bales of hay in the foothills of the Rocky Mountains near the town of Pincher Creek, Alberta September 27, 2010. The non-polluting source of renewable energy is fed into the provincial electrical grid that powers Southern Alberta industries and residences. REUTERS/Todd Korol

TORONTO (Reuters) - Canada’s eight biggest pension funds on Wednesday threw their weight behind global efforts to improve corporate sustainability reporting, urging companies and their investment partners to report environmental, social and governance (ESG) data in a standardized way.

In the first joint statement of its kind, CEOs of the top pension funds, which manage C$1.6 trillion ($1.2 trillion) in assets, demanded increased transparency from companies.

“How companies identify and address issues such as diversity and inclusion, human capital, board effectiveness and climate change can significantly contribute to value creation or erosion,” the statement released by Ontario Teachers’ Pension Plan, Canada Pension Plan Investment Board and the Public Sector Pension (PSP) Investment Board and others said.

They asked the companies to use the Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-related Financial Disclosures framework to further standardize ESG-related reporting.

BlackRock, the world’s largest asset manager, in October called for harmonized sustainability accounting rules and standards globally.

Earlier this autumn, the International Financial Reporting Standards (IFRS) Foundation said it was looking into standardization and comparability of reporting on sustainability and climate-change issues.

“For us to achieve the objectives of disclosure, we have a louder voice banding together and it’s the first time we’ve done that,” PSP Investments’ CEO Neil Cunningham told Reuters by phone, adding that the eight funds coming together “is more powerful than eight separate voices in the wilderness.”

Other funds that are part of the group include: the Ontario Municipal Employees Retirement System, Healthcare of Ontario Pension Plan, Caisse de dépôt et placement du Québec, British Columbia Investment Management Corporation and Alberta Investment Management Corporation.

Reporting by Maiya Keidan; Editing by Bernadette Baum

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