Canada Pension Plan Investment Board (CPPIB) has announced plans to issue an inaugural green bond, providing additional funding for CPPIB as it increases its holdings in renewables and energy efficient buildings.
Over the past year, CPPIB has announced plans to invest more than C$3 billion in the renewable energy sector as it works to ensure the Canada Pension Plan fund is well-positioned for the expected global transition to a lower-carbon economy.
“The issuance of green bonds is a logical next step to CPPIB’s investment-focused approach to climate change, and we are pleased to be a pioneer amongst pension funds in this regard,” says Poul Winslow, senior managing director and global head of capital markets and factor investing. “The capital raised will help support strong, long-term investments in eligible green assets that position the fund for continued success.”
CPPIB’s green bond framework defines three categories as eligible for investment from green bond proceeds:
- Renewable energy (wind and solar);
- Sustainable water and wastewater management; and
- Green buildings (LEED Platinum-certified).
CPPIB has also engaged the Center for International Climate Research, which provides second opinions on the qualification of debt for green bond status. Any green bonds issued in Canada will be issued on a private-placement basis only to certain qualified accredited investors, the board notes.
