Snapshot of the Responsible Investment Association (RIA) Canada Conference
As the Responsible Investment Association’s annual conference opened in Toronto, CEO Patricia Fletcher stated that responsible investment has matured and is now challenging assumptions. Investors are balancing expectations for decarbonization with a renewed focus on sovereignty, energy security, affordability, and Indigenous ownership.
The sentiment “don’t let a good crisis go to waste”, was often repeated during the RIA conference. It was apparent that investors are re-evaluating sustainable investing philosophy and strategy. Boards are weighing in on the need to address systemic risks, and what role investors should play in financing climate mitigation, adaptation, resilience, energy, artificial intelligence (AI), cyber-security, defence, and nature protection. Investors are also extending the scope of sustainable investing in private markets and infrastructure. Every investment question seemed to have implications for fund governance.
A snapshot of resonant discussion points:
Climate and taxonomies: The Ontario Teachers’ Pension Plan (OTPP), Ontario Municipal Employees Retirement System (OMERS) and Investment Management Corporation of Ontario (IMCO) each have a custom climate taxonomy but use it differently. OTPP uses its taxonomy to prioritize investment in the energy transition, with a goal of investing $70 billion in climate transition-aligned private markets investments by 2030. They recognized that their portfolio emissions may rise in the short term, requiring clear client communications as the fund deploys capital into high emitters with credible decarbonization plans. OMERS uses its taxonomy to assess climate transition risk and decarbonization, whereas IMCO uses its taxonomy to categorize climate solutions.
La Caisse uses the Climate Bonds Initiative taxonomy to identify, select, and track low-carbon assets for its decarbonization strategy. All four funds are increasingly addressing physical climate risk. Notably, the Taxonomy and Transition Planning Council at Business Future Pathways is working to develop Canada’s sustainable taxonomy with the research led by the Canadian Climate Institute. The first priority sector taxonomies—electricity, buildings, and transport—will be published in early 2027, ready for Canadian companies, banks, and governments to issue debt under the framework.
Energy: In examining trade-offs between the goal of energy security, affordability and sustainability, Canada’s energy strategy reflects economic pragmatism and a bet on clean power. Many discussed how it would be difficult to constrain oil and gas exports in the current environment as the world needs Canadian energy, yet Canada can still reduce emissions with clean fuels and carbon management. Replacing fossil fuels with clean power across key sectors creates a permanent drop in emissions so that Canada’s net-zero goal by 2050 is still a distinct possibility.
AI and cybersecurity: AI presents a sustainability paradox. AI can improve productivity and enable efficiencies but also drives skyrocketing electricity demand, increasing emissions, and straining water resources. Investors discussed the risks of moving too fast.
Defence: Defence, AI, and climate are closely connected. Given the geopolitical challenges for Canadian sovereignty, investor boards must determine their fund’s position and role in investing in defence. However, investments in defence may threaten funding for climate resilience.
Nature: Investors mentioned that adopting a nature-related disclosures practice statement would help them make informed investment and voting decisions on items that are related to nature such as data centres and carbon capture, utilization and storage. The International Sustainability Standards Board plans to issue a draft practice statement in October 2026, a timely consultation given investors’ concern.
Indigenous relations: Panelists re-stated that Indigenous communities are not merely stakeholders but rightsholders. Investors should identify what information about a company’s relationship with Indigenous Peoples is most relevant when making investment, engagement, and voting decisions, and track metrics to show progress.
Private markets: One should not overlook governance at private companies, which can be less mature. Sustainability metrics can be a leading metric for value. Investors noted that NYU ROSI, SASB, PMDR, SFDR, as well as the ESG Data Convergence Initiative EDCI are useful frameworks to start with.
Assumptions: In a world where major economic and geopolitical shifts are at play, Luiza Savage, editor of WP Intelligence, cautioned investors to rethink and revisit underlying assumptions, such as ‘efficiency creates value’, as they may be altered in today’s context. She raised an important point that: Economic dependency is a vulnerability. The global economy has endured multiple shocks in recent years; the pandemic, the Russian invasion of Ukraine, tariffs, and naval blockades.
Canadian context: The RIA Conference overlapped with the inaugural Canada Investor Summit, where Prime Minister Mark Carney promoted investment in Canada. The Summit’s messaging seemed to instill hope and optimism in RIA conference attendees despite current geopolitical and economic uncertainties. Canadian investors can play a significant role in shaping our world and allocating capital towards sustainable and resilient companies and infrastructure. The importance of good governance and the Canadian ‘trust factor’ resonated at both conferences.
