Nearly 10 months after Climate Justice U of T (CJUofT) called for the University Pension Plan (UPP) to immediately divest from fossil fuels in a Varsity article, the plan’s investments remain unchanged. Despite the relentless opposition of students and faculty, the University of Toronto has yet to address this issue.
U of T is one of four institutions with pension plans managed by the UPP, along with Queen’s University, University of Guelph, and Trent University. Collectively, the UPP’s 11.7 billion joint pension ensures retirement income for more than 40,000 faculty and staff across various universities.
Universities contribute to their employees’ pension plans by putting a percentage of their earnings into a fund, and approximately 76 per cent of the universities’ respective operating budget is applied toward salaries and benefits. According to a 2023–2024 report from U of T’s Planning and Budget Office, these budgets are composed of government grants (20 per cent), tuition and fees from domestic and international students (68 per cent), and “other” sources (12 per cent).
Alarmingly, our tuition directly supports oil companies that the UPP lends money to — something U of T fails to disclose to its students. Our money contributes to the destructive activities of the fossil fuel and defence companies listed on the UPP’s page on public equity holdings. There are valid reasons for students to be concerned about where their money is going.
Why are we concerned?
According to the UPP’s website, it believes that “environmental, social, and governance (ESG) factors, such as climate change, will fundamentally influence the long-term sustainability of financial markets.” It asserts that these factors are considered at every stage of investing to achieve long-term financial performance. However, their current holdings reveal companies like Exxon, Enbridge, Shell, Chevron, and Suncor — fossil fuel conglomerates renowned for their exploitation of people and the planet.
Canada’s big banks compose another significant portion of the portfolio, including the Royal Bank of Canada, Toronto-Dominion Bank, and the Bank of Montreal, which invested 42 billion USD, 29 billion USD, and 19.3 billion USD respectively into fossil fuels in 2022. Not only have their investments been key in upholding the fossil fuel industry, but these banks have also invested millions into companies arming the Israeli military, which is committing the Amnesty International-recognized genocide in Palestine.
Furthermore, fossil fuel companies profit from suppressing Indigenous peoples around the world, subjecting them to significant environmental and health impacts. Yet, UPP claims on their website that it honours the Truth and Reconciliation Commission’s Call to Action #92, which implores companies to adopt the United Nations Declaration on the Rights of Indigenous Peoples to affirm the Indigenous rights and sovereignty over their identity, education, and land. In order to separate itself from the oil and gas sector’s constant violations of Indigenous rights, we believe the UPP should adhere to their Climate Action Plan update and annual Responsible Investing report to end their investments in these industries.
The UPP’s refusal to divest stems from the plan manager’s belief that “investors have several mechanisms to catalyze the transition to a resilient, net-zero world,” as stated in their current Climate Action Plan. But to us, the absence of meaningful emission reductions reflects the inefficacy of this approach. Additionally, this line of thinking assumes that companies benefiting from the earth’s destruction would propose climate plans to minimize their emissions, presenting a paradox in itself.
An alternative plan
First and foremost, the UPP must divest from fossil fuel corporations, as well as from those profiting from the ongoing genocide in Gaza. We believe our demands are not just morally justified, but financially too.
The UN-Convened Net Zero Asset Owner Alliance (NZAOA) is composed of institutional investors committed to achieving net zero greenhouse gas emissions by 2050 with their portfolios — of which the UPP is a member. The Caisse de dépôt et placement du Québec (CDPQ), a large pension fund, and NZAOA’s other Canadian signatory have already divested from oil and coal. CDPQ reasons that this move will preserve the long-term value of their assets, stating that oil and coal are “not energies of the future.”
We know that divestment does not lead to reduced profits. A 2023 study from the University of Waterloo found that if six major US pension funds divested from fossil fuel companies a decade ago, they would have made a 13 per cent greater return on investment — an extra 20 billion USD — as well as slashed their emissions enough to power 35 million homes per year. Thus, there is no plausible justification for investments in these entities.
UPP’s President Barbara Zvan has been described by the National Observer as one of the most “climate-positive investment managers in the country.” If this is true, she should be actively listening to those who provide the majority of the funds and those who receive them in retirement.
Recently, the University of Toronto Faculty Association and the United Steelworkers Union at the University published an open letter to the senior management at U of T calling for fossil fuel divestment. CJUofT, Fridays for Future U of T, and U of T Environmental Action, among other student groups, continue to organize for fossil fuel divestment from the university, but these voices on campus are strengthened by numbers, so we implore you to get involved and express your concerns for our future under this plan.
2025 presents the opportunity for change — for better or for worse — and the UPP can be part of one or the other. If not now, when? The window for offsetting the climate crisis grows shorter each year, so now is the time that the UPP’s make divestment their resolution for the new year.
Avery Murrell is a fourth-year Woodsworth College student studying human biology and cell and molecular biology, and is involved in CJUofT’s Divest UPP campaign.
Arjun Arora is a third-year Innis College student studying physics and cognitive science, involved in CJUofT’s Divest UPP campaign.
Zahur Ashrafuzzaman is a first-year masters student of linguistics, involved in CJUofT’s Divest UPP and Banks Off Campus campaigns.
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