ICPM Discussion Forum – Fall 2010 Copenhagen

October 12 - 13 - 14, 2010

Key Insights and Possible Action Items:

To download a PDF of the Key Insights from this Discussion Forum click here.

Case Study

Case Study 4: Climate Change and Pension Funds: Risk, Opportunity or Distraction?

The Rotman International Centre for Pension Management (ICPM) organized a fourth Case Study session on the impact of climate change on pension funds. The case was written for the ICPM October 2010 Discussion Forum in order to explore the risks and opportunities related to climate change. The participants in the lively debate were a large number of representatives of pension delivery organizations from a variety of countries (Australia, Canada, Denmark, Finland, Japan, Netherlands, New Zealand, Sweden, United Kingdom, and United States). A complete attendee list is attached.

The context of the fourth case is the well‐developed Canadian pension industry. Stephen Henderson is the Chief Executive Officer (CEO) of Canadian Resource Industries Pension Plan (CRIPP), a mature multi‐ employer Canadian plan. It has existed in its current form for ten years, and resulted from a number of mergers in the 1990s of smaller pension plans serving the mining, forest and energy industries. After a series of meetings with his European counterparts, Stephen realized that he was far from up‐to‐date on the potential impact climate change could have on CRIPP’s balance sheet. An intensive period of study on the topic of climate change and the potential impact on pension funds persuaded Stephen and his senior colleagues that climate change could indeed be a major consideration in the management of CRIPP’s assets and liabilities.

The central question of this case is: are Stephen and his colleagues right in this judgment? And, if they are, how should they persuade a skeptical Board of Trustees to address this issue?

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