As climate-fueled wildfires rage, CPPIB praises Canada’s largest oil & gas producer
Screenshot of the CPP Investments Insights Institute’s profile of CNRL.
Amidst another summer of heatwaves, droughts and wildfires forcing Canadians to flee their homes, the Canada Pension Plan Investment Board (CPPIB) made a bizarre decision to profile its investment in an oil and gas company whose business model is fundamentally incompatible with the long-term retirement security of Canadians.
The profile was on Canadian Natural Resources Ltd. (CNRL)-- Canada’s largest oil and gas producer. The CNRL profile was featured as part of the CPPIB Investments Insights Institute’s “Mapping Canadian Capital” series, which “offer(s) insight into how a major global capital allocator approaches long-term partnership, value creation, and the complexities of investing in an evolving economic landscape.”
CPPIB promoted its spotlight on CNRL with a LinkedIn post about “Investing in a Canadian energy powerhouse”, calling CNRL “a prime example of Canadian energy leadership on the global stage.” In August, “Ashley” from CPPIB sent subscribers an eblast with the subject line “Investing in Canada’s energy sector” that called CPPIB “proud investors in Canadian energy” and “committed to supporting Alberta’s world-class energy sector.” “Ashley” explained that CNRL produces over 1.5 million barrels of oil equivalent each day, highlighting that CPPIB has invested $1.8 billion in the company and “see(s) long-term value in Canada’s oil and gas sector.”
That CPPIB would choose to spotlight its financing of Canada’s biggest oil and gas producer while downplaying the existential risks of climate change is dumbfounding. Despite its duty to invest in the best interests of Canadians decades into the future, CPPIB is greenwashing a fossil fuel company that undermines the pension manager’s ability to achieve its own mandate.
Screenshot of CPPIB LinkedIn post of its profile of CNRL.
What does CPPIB say about CNRL?
CPPIB’s profile of CNRL reads like a propaganda piece for the company, continuing a long and well-documented track record of CPPIB cheerleading for the oil and gas sector and greenwashing the industry’s growing climate pollution while ignoring the escalating financial risks the industry faces.
The profile highlights CNRL’s scale, “long-life, low-decline” oil sands assets, extensive capital expenditure in Alberta, and “long-term production stability” that ensures “it has decades of inventory left.” A CPPIB managing director praises “the strength of (CNRL’s) leadership” and the company’s “clear focus on the long term”, with the post featuring quotes from CNRL’s president.
The post fails to acknowledge the incompatibility of CRNLs “long term” growth plans with a healthy economy or a livable planet. What kind of world does CPPIB expect Canadians will retire into?
CPPIB’s mandate requires our national pension manager to invest in the best interests of all Canadians, including its youngest members who won’t collect their first CPP payment for decades. If companies like CNRL continue with business-as-usual, Canada and the world will fail to avert catastrophic climate change. The ability of CPPIB to fulfill its mandate and for Canadians to enjoy retirement security in the decades to come is dependent on CNRL and other oil and gas companies rapidly phasing out production.
As Michel Leduc, CPPIB’s head of public affairs and communications told the CBC in June, CPPIB is “investing money for people who aren't even born yet. That long-term thinking must be the strongest pillar of how we think about our investment strategy." Leduc went on to say that CPPIB isn't "short-term stupid… We're continuing to think through what could be some of the bigger impacts."
But that doesn’t appear to be true. CPPIB doesn’t seem to understand the risks of ecological collapse, financial instability and economic turmoil that are expected if Canada and the world fail to limit global heating to relatively safe levels. Any future in which CNRL succeeds in selling more oil is also a future that fails to protect Canadians from unacceptable physical and financial harm.
What does CPPIB not say about CNRL and the oil and gas industry?
CPPIB neglects to mention that, as Canada’s largest oil and gas producer, CNRL is one of the largest emitters of greenhouse gas emissions in North America. CNRL’s operations and products are directly causing climate change and undermining the ecological, economic and financial systems on which Canadians rely on for their livelihoods, health and retirement security. Since 2005, climate pollution from the oil sands has grown by 222%.
Climate change is primarily caused by the production and use of fossil fuels– oil, gas and coal. There is scientific consensus that limiting global heating to 1.5℃ requires an immediate end to fossil fuel expansion, the phase-out of fossil fuel production, and a rapid transformation of our energy system to zero-carbon forms of generation. Climate change has already been declared an emergency by Canada’s federal government, which has committed to net-zero emissions by 2050. The longer Canada and the world waits to phase out fossil fuels, the worse the climate crisis gets.
According to the Canadian Climate Institute, climate change is already slowing economic growth and increasing costs for households. Climate impacts from extreme weather are already costing the Canadian economy $25 billion annually, with potential for costs rising to $100 billion annually by 2055. According to the Insurance Bureau of Canada (IBC), insured damage from climate-fueled extreme weather events hit a record $8.5 billion in 2024. Experts are warning that Canada could become uninsurable within a decade if urgent action isn’t taken to reduce greenhouse gas emissions to accelerate adaptation.
The direct impact on Canadians’ lives and livelihoods is palpable. Canada has seen 51 heat records broken across the country this summer and experienced its second-worst wildfire season on record. A forested area the size of New Brunswick has burned. One in seven First Nations in Canada have been evacuated due to wildfires. In recent years, hundreds of Canadians have died during climate-fueled heatwaves, with extreme heat getting more frequent and intense throughout Canada.
Source: Canadian Climate Institute - Damage Control - Reducing the costs of climate impacts in Canada (September 2022)
Greenwashing
CPPIB’s profile on CNRL notes that it “believes long-term investors have a critical role to play in financing emissions reduction in the real economy,” before repeating its tired talking point that “Simple divestment of oil and gas is essentially a short on human ingenuity.”
CPPIB’s CEO goes on to write that Canada “produce(s) some of the most responsibly developed energy in the world,” without providing any evidence to support this industry propaganda line. A recent analysis finds that the lifecycle emissions profile of Canada’s LNG industry is among the highest in the world. Meanwhile, Canada’s oil industry is among the most carbon-intensive on earth, driven in particular by oil sands production. Since 2005, climate pollution from the oil sands sector has increased 222%. A recent peer-reviewed article in Science revealed that emissions from the oil sands were up to 6300% higher than what the oil industry was reporting.
CPPIB also claims that it’s “deploying patient capital into companies that are set up for success today and equipped to lead through the global transition,” which “has shaped CPP Investments’ long-standing partnership with Canadian Natural.” According to CPPIB,
“The energy giant (CNRL) is a founding member of Canada’s Oil Sands Innovation Alliance and the Pathways Alliance, which aims to achieve net-zero emissions from oil sands operations by 2050. And Canadian Natural continues to invest in decarbonization technologies such as carbon capture, electrification, and process improvements, with the aim of reducing its emissions profile over time.”
CPPIB provides no examples of CNRL meaningfully investing in decarbonization or reducing its total emissions. That’s because CNRL’s emissions are increasing, the company has no credible plan to achieve net-zero by 2050, and its business model is predicated on expanding production. The company undertakes significant lobbying against climate regulations to prolong the production and use of oil and gas.
CNRL’s business model is fundamentally incompatible with climate safety
No objective observer would make the case that CNRL has a credible climate plan.
In its recent profile of CNRL, financial think tank Carbon Tracker concludes that CNRL “is not Paris-aligned, particularly given its production growth and lack of disclosed emissions goals.”
Carbon Tracker finds that CNRL:
Appears to be planning for a slow transition;
Is pursuing increasingly bullish growth plans;
Is exposed to significant risk of lower revenues, stranded assets, and earlier-than-anticipated asset retirement obligations;
Removed disclosures with details on its carbon capture and storage plans, which carry high costs and commercial viability risk;
Removed disclosure of emissions reduction goals from its website in 2024, making it unclear if CNRL is still pursuing any climate goals;
Is misaligned with a 1.5°C scenario, particularly given the long-life nature of its asset base.
If CPPIB were to heed Carbon Tracker’s advice and ask some tough questions about CNRL’s climate impact, business strategy and energy transition readiness, then CPPIB would likely conclude that the company is not a prudent long-term investment for a pension fund.
Source: Carbon Tracker - CNRL - Oil and Gas Company Profile (May 2025)
Similarly, global investor climate engagement initiative Climate Action 100+ (CA100+) finds that CNRL fails to meet net-zero alignment criteria on ten of eleven indicators. According to CA100+, CNRL:
Has not set an ambition to achieve net zero GHG emissions by 2050 or sooner;
Does not have short-term greenhouse gas reduction targets;
Does not have a decarbonisation strategy that explains how it intends to meet its medium- and long-term GHG reduction targets; and
Does not conduct its policy engagement activities in accordance with the goals of the Paris Agreement.
CPPIB’s own proxy voting guidelines say that it will “consider voting against” the reappointment of accountable board members where boards have failed to demonstrate adequate oversight with respect to the assessment of material physical and transition-related impacts from climate change. According to its proxy voting database, CPPIB has never voted against a CNRL director, going back to 2010.
Source: Climate Action 100+ - Company Assessment - CNRL (June 2024)
CNRL is lobbying against climate policy
Stringent, ambitious, Paris-aligned climate and energy laws, policies and regulations will provide certainty for companies and investors, enable Canada to achieve its climate commitments and help limit global temperature increase to 1.5°C. The goals of strong climate policies align with those of pension fiduciaries to ensure the long-term best interests of beneficiaries. A failure of Canada and the world to achieve the goals of the Paris Agreement would lead to ecological, economic and financial consequences that could make it impossible for pension managers to fulfill their mandates.
Yet CNRL and its industry associations actively lobby to block, delay and dismantle federal and provincial climate policies and regulations. According to LobbyMap’s analysis of CNRL’s engagement on climate policy, CNRL:
Engages negatively on climate policy and regulations;
Advocates for increasing oil and gas production and against emissions regulations;
Promotes a long-term role for oil and gas;
Offers limited transparency in its industry association memberships and their role in climate policy engagement.
In April, CNRL joined other fossil fuel companies in writing to Prime Minister Carney asking the new federal government to dismantle a range of federal climate policies, including gutting the Impact Assessment Act, repealing the West Coast Tanker Ban, eliminating the proposed cap on oil and gas emissions and ending the federal carbon levy on large emitters. These actions would essentially demolish meaningful federal regulation of the oil and gas sector’s climate pollution and make it impossible for Canada to achieve its climate commitments. CNRL’s president is also pushing for a new Canadian crude oil pipeline, noting that “production has to be able to fill that pipeline.”
Is this what CPPIB means when it touts “the strength of (CNRL’s) leadership” and its “clear focus on the long term”?
CNRL’s liability risks
CPPIB appears to be ignoring the significant liability risks associated with the costs of cleaning up and remediating CNRL’s oil and gas wells, oil sands sites and other assets and properties. A 2019 study by the Alberta Liabilities Disclosure Project singled out CNRL as being responsible for $11.9 billion of cleanup liabilities for 73,000 oil, gas and bitumen wells in Alberta.
The same week that CPPIB published its CNRL greenwashing profile, The Narwhal published an investigation revealing how CNRL failed to meet a commitment set by British Columbia’s (BC) energy regulator to deactivate more than 4,300 pipelines it operated across BC and then pressured the regulator not to fine the company for its failure.
CPPIB’s support for CNRL disregards scientific consensus on climate change
Climate change is already negatively impacting Canadian lives and livelihoods and putting a damper on economic growth… and our national pension manager thinks it’s a good idea to highlight an investment in Canada’s biggest oil and gas producer that is incompatible with fulfilling CPPIB’s long-term mandate. CPPIB continues to ignore the increasingly dire scientific warnings about the climate crisis and double down on financing oil and gas expansion.
CPPIB’s approach to climate change and fossil fuels stands in stark contrast to what climate scientists, financial experts and other pension funds say is required. For example:
“The fossil fuel transition policy requires financial institutions to publish a policy committing to the immediate cessation of new finance for coal expansion and new project finance for oil and gas expansion, as well as the phase-out of new general-purpose finance for oil and gas expansion immediately or by no later than 2030.”
Science-Based Targets initiativeFinancial Institutions Net-Zero Standard
“Since the implementation of our first climate strategy in 2017, we have taken decisive action, including completing our exit from oil production and coal mining; we no longer want to contribute to the supply of these two types of energy, which are not energies of the future.”
La Caisse2023 Sustainable Investing Report
“We want to contribute to minimising global warming to 1.5C. Large groups of pension participants and employers indicate how important this is to them. The ABP board sees the need and urgency for a change of course. We part with our investments in fossil fuel producers because we see insufficient opportunity for us as a shareholder to push for the necessary, significant acceleration of the energy transition at these companies.”
Chair of Dutch pension fund ABPOctober 9, 2021