Briefing

Canada’s biggest pension manager is reexamining its Chinese investments

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The Canada Pension Plan Investment Board (CPPIB) is reviewing its portfolio to identify companies linked to human rights violations in China. CPPIB has ownership stakes in Chinese surveillance equipment companies that the U.S. wants blacklisted for violating the rights of minority populations in China. “Companies that violate human rights aren’t positioned to succeed and have no place in any portfolio that exists to deliver risk adjusted returns over multiple generations,” said Michel Leduc, global head of public affairs and communications. CPPIBis still looking for additional Chinese investments to help diversity its portfolio. (Globe and Mail)

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Talking point: The review comes as financial institutions and companies face increasing pressure to disclose their social and environmental track records. On Tuesday, Norway’s biggest pension fund said it’s divesting from companies that generate at least five per cent of their  revenues from alcohol and gambling. Scholars on ESG (environmental, social and governance) investing—including Harvard Business School professor Robert Eccles—note that while portfolio managers once viewed ESGs as nice-to-haves, they increasingly treat them as crucial to their bottom line, not just their public image.