CEOs urge Ottawa to change pension fund rules

Business leaders want agencies to ‘invest in Canada’

Nearly 100 top Canadian business leaders have signed an open letter to Finance Minister Chrystia Freeland and her provincial counterparts, urging them to change investment rules for pension funds to “encourage them to invest in Canada.”

The letter, published as an ad in major Canadian newspapers on Wednesday, included signatures from Rogers Communications Inc. CEO Tony Staffieri and TMX Group Ltd. CEO John McKenzie, whose company runs the Toronto Stock Exchange. Of the current CEOs of the country’s six largest banks, National Bank of Canada’s Laurent Ferreira was the only one to add his name to the letter.

“Canada has great companies, true global champions. These competitive businesses deserve our support and we must create many more,” said the letter. “Increasing investments in Canada should be a national priority.”

Canadian pension funds have cut their holdings of publicly traded companies to just four per cent of assets, from 28 per cent in 2000, according to the letter. The executives stopped short of making specific recommendations on how to change the rules by which pensions are governed.

Spokespeople from Canada Pension Plan Investment Board and several other large pension funds did not immediately respond to a request for comment.

Canadian pension funds once faced strict limits on how much they could invest in foreign assets, but most of those restrictions were lifted nearly 20 years ago. Alongside that, most of the largest public pension managers have shifted more of their capital toward private equity, private credit and infrastructure and away from publicly traded stocks.

In November, Freeland proposed measures to require large, federally-regulated pension plans to disclose more information about where they invest, and to consult with pensions “to create an environment that encourages and identifies more opportunities for investments in Canada by pension funds.”