While many organizations have launched a sustainability strategy, Sun Life Financial Inc.’s strategy is anchored in three fundamental principles: financial security, sustainable investing and living healthier lives, according to Eric Monteiro, the insurer’s senior vice-president in group retirement, during a panel discussion at Benefits Canada‘s 2022 DC Plan Summit.
Three-quarters (78 per cent) of pension plan members are interested in more sustainable investments, but just 30 per cent understand they can impact sustainability with the investment choices they make, he said, noting this highlights the important work ahead for the industry in educating and communicating these options to plan members.
Also speaking during the session, Louise Koza, director of human resources, digital and operations at Western University, shared how the university is integrating environmental, social and governance factors into its defined contribution pension plan’s investment strategy. Since 2007, it has evaluated investment managers and made selections through an ESG lens. It also includes a socially responsible investment fund among the 15 funds on its platform.
Many of the university’s stakeholders have asked it to divest from fossil fuels, she said, adding the endowment fund is working with the University Network Coalition to engage with investors on that topic. “On the defined contribution pension plan side . . . we’ve got more to do to think about that. On the other hand, it’s a different body, so our pension board is making the decisions. And, of course, they’re there to make sure members can accumulate adequate returns in income for retirement.”
Definity Insurance is also aligning its purpose with its business strategies, including one dedicated to ESG issues, said Lianne Buchanan, the organization’s assistant vice-president of total rewards, also speaking during the session.
“We think managing our ESG risks and opportunities and then also creating a positive impact is an important part of our strategy. We think there’s definitely longer-term benefits associated with that for our stakeholders. We really think it’s a part of who we are and it’s, quite frankly, good for business.”
The organization has also made commitments around net-zero emissions and intends to translate that focus to its DC plan’s investments, she said, noting it’s still early days.
“We didn’t want to be doing work for the sake of work. We wanted to ensure there was alignment at that level. So once the strategy and framework was set for the organization, we actively then began work with the pension committee around how we could integrate that and reflect it in our plan.”