The Canadian Pension Plan is Funding the End of the World And What We Can Do About It

By Rachel Small, World BEYOND War, July 31, 2022

I recently had the honour of speaking at an important webinar entitled “What is the Canadian Pension Plan Investment Board Really Up To?” co-organized with our allies Just Peace Advocates, Canadian Foreign Policy Institute, Canadian BDS Coalition, MiningWatch Canada, and Internacional de Servicios Públicos. Learn more about the event and watch the full recording of it here. Slides and other info and links shared during the webinar are also available here.

Here are the remarks I shared, summarizing some of the ways that the Canadian Pension Plan is funding the death and destruction of people and the planet — including fossil fuel extraction, nuclear weapons, and war crimes — and highlighting why and how we should demand nothing less than a fund invested in and actually building a future we want to live in.

My name is Rachel Small, I’m the Canada Organizer with World Beyond War, a global grassroots network and movement advocating for the abolition of war (and the institution of war) and its replacement with a just and sustainable peace. We have members in 192 countries worldwide working to debunk the myths of war and advocating for—and taking concrete steps to build—an alternative global security system. One based on demilitarizing security, managing conflict nonviolently, and creating a culture of peace.

As organizers, activists, volunteers, staff, and members of our incredible world beyond war chapters we’re working to end the violence of militarism and war machine, in solidarity with those most impacted by it.

I myself am based in Tkaronto, which like many of the cities people here are joining from, is one built on stolen Indigenous land. It’s land that is the ancestral territory of the Huron-Wendat, the Haudenosaunee, and the Anishinaabe peoples. It’s land that needs to be given back.

Toronto is also the seat of Canadian finance. For anticapitalist organizers or those involved in mining injustice that means this city is sometimes known as the “belly of the beast”.

It’s worth noting as we talk today about investing the wealth of Canadians that so much of the wealth of this country has been stolen from Indigenous peoples, comes from removing them from their lands, often to then extract materials to build wealth, whether through clearcuts, mining, oil and gas, etc. The ways in which in many ways the CPP continues colonization, both across Turtle Island as well as in Palestine, Brazil, the global south, and beyond is an important undercurrent to tonight’s entire discussion.

As was laid out in the beginning, the Canadian pension fund is one of the largest in the world. And I want to share some information now about a little-aspect area of its investments, which is in the weapons industry.

As per the numbers that were just released in CPPIB’s annual report CPP currently invests in 9 of world’s Top 25 arms companies (according to this list). Indeed, as of March 31 2022, the Canada Pension Plan (CPP) has these investments in the top 25 global weapons dealers:

Lockheed Martin – market value $76 million CAD
Boeing – market value $70 million CAD
Northrop Grumman – market value $38 million CAD
Airbus – market value $441 million CAD
L3 Harris – market value $27 million CAD
Honeywell – market value $106 million CAD
Mitsubishi Heavy Industries – market value $36 million CAD
General Electric – market value $70 million CAD
Thales – market value $6 million CAD

To put it frankly, this is the CPP investing in the companies that are literally the world’s biggest profiteers. The same conflicts around the world which have brought misery to millions have brought record profits to these arms manufacturers this year. The millions of people around the world who are being killed, who are suffering, who are being displaced are doing so as a result of the weapons sold and military deals made by these corporations.

While more than six million refugees fled Ukraine this year, while more than 400,000 civilians have been killed in seven years of war in Yemen, while at least 13 Palestinian children were killed in the West Bank since the start of 2022, these weapons companies are raking in record billions in profits. They are the ones, arguably the only people, who are winning these wars.

And this is where a huge amount of Canadian funds are being invested. This means that, whether we like it or not, all of us who have some of our wages invested by the CPP, which is the vast majority of workers in Canada, are literally investing in maintaining and enlarging the war industry.

Lockheed Martin, for instance, the world’s top weapons maker, and deeply invested in by the CPP, has seen their stocks soar nearly 25 percent since the start of the new year. This connects with many other aspects of Canadian militarism. In March the Canadian government announced they had selected Lockheed Martin Corp., the American manufacturer of the F-35 fighter jet, as its preferred bidder for the $19 billion contract for 88 new fighter jets. This aircraft has only one purpose and that is to kill or destroy infrastructure. It is, or will be, a nuclear weapon capable, air-to-air and air-to-ground attack aircraft optimized for war fighting. This type of decision to buy these jets for a sticker price of $19 billion and a lifecycle cost of $77 billion, means that the government will certainly feel pressured to justify its purchase of these exorbitantly priced jets by in turn using them. Just as building pipelines entrenches a future of fossil fuel extraction and climate crisis, the decision to purchase Lockheed Martin’s F35 fighter jets entrenches a foreign policy for Canada based on a commitment to wage war via warplanes for decades to come.

On one hand you could argue this is a separate issue, of the Canadian government’s military decisions to buy Lockheed’s fighter jets, but I think it’s important to connect that with the way that the Canadian Pension Plan is also investing many millions of dollars in the same company. And these are just two of several ways that Canada is contributing to Lockheed’s record-breaking profits this year.

It’s also important to note that all but two of the 9 companies I mentioned earlier that the CPP is investing in are also significantly involved in the production of nuclear weapons globally. And this doesn’t include indirect investments in nuclear weapons producers for which we’d have to list many other companies.

I don’t have time here today to speak too much about nuclear weapons, but it’s worth reminding us all that there are more than 13,000 nuclear warheads exist today. Many are on high-alert status, ready to be launched within minutes, either deliberately or as the result of accident or misunderstanding. Any such launch would have catastrophic consequences for life on Earth. To put it mildly, nuclear weapons pose a serious and immediate threat to literal human survival. There have been accidents involving these weapons in the U.S., Spain, Russia, British Columbia and elsewhere over decades.

And once we’re on the cheery subject of threats to human survival, I do want to briefly highlight another area of CPP investment – fossil fuels. CPP is deeply invested in perpetrating the climate crisis. Canadian pension funds invest billions of our retirement dollars in companies and assets that expand oil, gas and coal infrastructure. In many cases, our pension funds even own the pipelines, oil and gas companies, and offshore gas fields themselves.

The CPP is also a huge investor in mining companies. Which not only continue colonization, and are responsible for land theft and contamination but also the extraction and primary processing of metals and other minerals is itself responsible for 26 percent of global carbon emissions.

On many levels the CPP is investing in what we know will make the planet literally unliveable for future generations. And at the same time they are very actively greenwashing their investments. Canada Pension Plan Investment Board (CPP Investments) recently  announced that they are making a commitment for their portfolio and operations to achieve net-zero greenhouse gas (GHG) emissions across all scopes by 2050. This is too little too late and looks a lot more like greenwashing than actively committing to keep fossil fuels in the ground which is what we know is actually needed.

I also want to touch on the idea of CPP independence. CPP stresses that they are indeed independent of governments, that they instead report to a Board of Directors, and it is the Board that approves their investment policies, determines strategic direction (in collaboration with CPP Investments management) and approves key decisions about how the fund operates. But who is this board?

Of the 11 current members on CPP’s board of directors, at least six have either worked directly for or served on the boards of fossil fuel companies and their financiers.

Notably the chairperson of the CPP board is Heather Munroe-Blum who joined the CPP board in 2010. During her tenure there, she has also sat on the board of RBC, which is the number one lender and number two investor in Canada’s fossil fuel sector. Perhaps more than almost any other institution in Canada not itself an oil company, it has a deeply vested interest in seeing fossil fuel production grow. It is for example the major funder of the Coastal Gaslink pipeline shoving through Wet’suwet’en territory at gunpoint. RBC is also a major investor in the nuclear weapon industry. Whether or not there’s a formal conflict of interest, Munroe-Blum’s experience on the board of RBC can’t help but inform how she feels CPP should be run or the types of investments they should deem secure.

The CPP says on their website that their purpose is to “create retirement security for generations of Canadians” and the second line of their annual report they’ve just released says their clear focus is “safeguarding the best interests of CPP beneficiaries for generations.” Fundamentally I think we have to ask ourselves why it is that an institution that is mandatory for the majority of Canadian workers to contribute to, that is set up ostensibly to help secure our futures and that of our children, seems to instead be funding and actually bringing about immense present day and future destruction. That, especially considering nuclear involvements and climate change is funding the literal end of the world. Funding death, fossil fuel extraction, water privatization, war crimes…I would argue these are not only a terrible investment morally, but are also bad investments financially.

A pension fund actually focused on the future of workers in this country would not be making the decisions the CPPIB is doing. And we should not accept the current state of affairs. Nor should we accept investments that might value workers lives in Canada while throwing people across the world under the bus. We need to reject a public pension system that continues to redistribute resources and wealth from exploited countries around the world to Canada. Whose earnings come from blood spilled from Palestine, to Colombia, from Ukraine to Tigray to Yemen. We should demand nothing less than a fund invested in a future we want to live in. I don’t think that’s a radical proposition.

I stand by that, but I also want to be honest that this is a really tricky battle ahead of us. World BEYOND War does many divestment campaigns and wins several every year, whether divesting city budgets or worker or private pension plans, but the CPP is a difficult one as it’s deliberately designed to be extremely difficult to change. Many will tell you impossible to change, but I don’t think that’s true. Many will also tell you that they are completely shielded from political influence, from being concerned about public pressure, but we know that is not entirely true. And earlier panelists did a great job of showing how much they certainly do care about their reputation in the eyes of the Canadian public. That creates a small opening for us and means we absolutely can force them to change. And I think tonight is an important step towards that. We have to start by understanding what they are doing on the path to building broad movements to change it.

There’s a lot of approaches to how we can bring about that change but one I want to highlight is that every two years they hold public meetings across the country – usually one in almost every province or territory. This fall is when that will happen again and I think this presents a key moment where we can organize intersectionally and show them that we don’t have confidence in the decisions they are making – that their reputation is very much at risk. And where we should demand nothing less than a fund invested in and actually building a future we want to live in.