UBCM has updated its Primer on Climate Action and the Municipal Pension Plan (MPP). As UBCM developed the 2021 Primer, we used this opportunity to evaluate the progress made on climate related investments over the past five years. Real progress has been made and additional opportunities lie ahead.
The Primer was prepared in response to a resolution adopted by the UBCM membership at the 2020 Convention. This report goes considerably beyond the scope of the resolution to provide a range for the MPP's fossil fuel related investments over multiple years, as well as information on matters of governance and investment management pertaining to divestment. In addition, the Primer provides an overview of the importance of the Municipal Pension Plan and the governance structure in place, including the fiduciary duty of the Board of Trustees. We provide an overview of the plan design and service providers. The Primer revisits the importance of investments in the pension plan, and references that about 75 cents of every pension dollar comes from investment returns.
The Primer contains a dedicated section discussing MPP’s exposure to fossil fuels, provides detailed lists of top corporate holdings by asset category and information about the portfolio’s carbon footprint. Where possible, the data is compared to information that was available in an earlier UBCM Primer that was published in 2016. Since 2015, the MPP’s portfolio has grown and evolved with a 53% increase in assets. The total asset value of the MPP at December 2020 is approximately $66.5 billion. Of this amount, energy investments amount to approximately 2.2% of the total portfolio. The Primer documents MPP’s progress made over the past five years as a responsible investor and reaffirms the preferred approach of engagement compared to a divestment approach.
The Primer also sets out sets out future actions for UBCM as we continue to build on the governance, policies and priorities of the Municipal Pension Plan.
The Primer is listed as Policy Paper 2 and will be debated as part of the resolutions session at Convention.