First Take: SHARE’s early review of the 2030 Emissions Reduction Plan

For many years, responsible investors and climate change activists alike lamented that Canada never seemed quite willing enough to use its muscle to reduce emissions.

Would Canada ever be able to meet its emissions reductions targets? Would investor action be enough to make the difference? Issuers frequently pointed to the absence of policy framework and direction as an excuse to not take sufficient action, and in order to shift the conversation from “if” to how, we needed caps on emissions to frame investor-issuer dialogue. 

At first blush, it looks like today may be a day for cautious optimism. The federal release of its 2030 Emissions Reduction Plan burned up computer screens across the country as analysts scoured the 250-page plus document for the hard truths that meeting our 2030 targets must entail.

Here is our preliminary breakdown of highlights that fit the bill: 

Oil and Gas Targets and Caps

The plan sets targets by sector—including oil and gas, the largest sectoral emitter—which now must contribute a reduction of 31 percent below 2005 levels. The plan points to “increasing stringency in measures to accelerate and deepen emissions reductions, including caps.” 

In addition, oil and gas-related methane emissions must be reduced by 75 percent by 2030. 

Sustainable Finance 

There are a number of references or commitments that support the work of responsible investors and sustainable finance:

  • The new collaborative engagement initiative, Climate Engagement Canada, for which SHARE plays a secretariat role, is highlighted as an example of progress in determining low emission pathways for Canada’s financial and corporate sectors; 
  • the commitment is being made to work with provinces to create a climate data strategy; 
  • Finance and Environment and Climate Change Canada (ECCC) will publish an annual report on financial risks and opportunities related to climate change. 

Overall, sustainable finance is referred to as a “cross-cutting policy tool” and is referenced multiple times in relation to its importance in allocation of capital for new technologies and low carbon alternatives.  

We are glad to see the document also infuses a commitment to Just Transition approaches, and Indigenous partnerships throughout many of its plans and commitments. 

Causes for Concern

It’s worth mentioning, of course, that there also are some causes for concern:  

  • Continued investment in carbon capture could send the wrong signal to an industry that seems to have put most of its eggs in that basket for far too long already. Let’s not forget this is a technology that hasn’t yet proven to be scalable, effective, or economically feasible to help with 2050 targets let alone 2030; 
  • Canada still lags on mandatory climate-related disclosures. There is an opportunity here to Make emissions reporting mandatory, and inclusive of material Scope 3 emissions, and in particular to look to adopt an equivalent rule currently under consideration, as proposed by the American Securities and Exchange Commission.  

There will be lots of news and analysis from all corners in the coming days and months, but one thing is certain: SHARE looks forward to working with our clients and partners to leverage components of this legislation to accelerate momentum with high emitting issuers in the Canadian and global economy.  


Jennifer Story
Written By:

Jennifer Story

Working as part of SHARE’s Active Ownership team, Jennifer is the Associate Director of Climate Advocacy, leading climate-focused corporate engagement initiatives on behalf SHARE’s networks of investors. Since 2014, Jennifer has also served as an elected Trustee at the Toronto District School Board.

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