The Economic Case for Divestment
The study makes the economic case for divestment from fossil fuels, due to risk factors such as aggressive new climate policies. It is aimed at informing pension fund trustees about the risks associated with fossil fuel investments, and for interested workers who want to better understand what their pension money is up to, and how to ask the right questions.
A review of Canadian public pension fund annual reports found that action on climate change was not mentioned as a material risk to pension sustainability. Marc Lee and Justin Ritchie estimate the top 20 public pension funds have around 4-9% of their funds invested in fossil fuel stock. The study looks at the recent collapse of oil prices as a sign of things to come. The top 20 funds had estimated holdings of approximately $27 billion in fossil fuel company stock prior to the commodity price fall. This translates into losses of approximately $5.8 billion, a conservative estimate based on equities only.
About the authors
Marc Lee
Marc Lee is a Senior Economist with the Canadian Centre for Policy Alternatives. Marc joined the CCPA’s British Columbia office in 1998, and is one of Canada’s leading progressive commentators on economic and environmental policy issues. From 2009 to 2015, Marc led the CCPA’s Climate Justice Project (CJP), which published a wide range of research on fair and effective approaches to climate action through integrating principles of social justice. Marc continues to write about climate and energy policy, strategies for affordable housing, federal and provincial budgets and macroeconomics. Marc has an MA in Economics from Simon Fraser University and a BA in Economics from the University of Western Ontario. Marc is a past chair of the Progressive Economics Forum, a national network of heterodox economists. He also served as a Visiting Professor at Simon Fraser University’s School of Public Policy in 2024 to 2025.