Despite global political uncertainty and increasing regulatory scrutiny, Canadian institutional investors remain committed to ESG strategies, reinforcing long-term value creation over short-term market shifts. A recent Millani Semi-Annual ESG Sentiment Study found that 93% of Canadian investors continue integrating sustainability considerations into their financial strategies, emphasizing risk management, engagement, and long-term impact rather than reactionary shifts to political trends. 

The 2024 U.S. election has raised concerns about potential rollbacks in sustainability regulations, yet Canadian investors remain largely unshaken. While ESG branding may decline, firms continue embedding ESG principles into core investment decision-making, focusing on climate risk, fiduciary duty, and financial materiality. 

A key test for ESG resilience came in 2024, when Exxon Mobil sued investor groups advocating stricter climate policies. Yet 86% of Canadian investors affirmed their engagement strategies would remain unchanged, viewing companies as long-term partners rather than adversaries. Instead of backing down, investors see the rising scrutiny on ESG proposals as a means to improve research quality and drive more effective engagement. 

Beyond climate risk, investors are broadening their ESG priorities. Nature-based solutions are gaining traction, with 15% of investors prioritizing biodiversity initiatives. Additionally, Indigenous reconciliation and economic development are becoming critical focus areas, positioning Canada as a leader in community-driven sustainable investments. 

As Canada moves toward its 2025 federal election, institutional investors are pushing for a clear transition taxonomy to guide national decarbonization and carbon neutral strategy. Without a standardized framework, concerns over greenwashing and market fragmentation grow, leaving investors to rely on European guidelines. 

Despite political and legal challenges, Canadian institutional investors are refining their ESG strategies rather than retreating. The focus is shifting from public commitments to internal execution, emphasizing measurable sustainability outcomes, risk-adjusted returns, and structured corporate engagement to secure Canada’s leadership in sustainable finance. 

Sources : 

https://www.environmentenergyleader.com/stories/canadian-investors-stay-committed-to-esg-despite-challenges,65279