Canadians live the way we do because we have one of the most productive, innovative, and responsible energy industries in the world. Photo credit: Wikimedia Commons
“The Canadian banking system is well-known for its strength and stability and the sector is an essential contributor to the country’s economic growth and well-being. Canadians rely on sound, stable banks to help them purchase a home, save for retirement, support the growth of small businesses, and drive the economy, which generates economic benefits to all Canadians.” — Canadian Bankers Association
But what happens when the banks follow ideologies and policies that hurt a sector that is central to Canada’s economy and prosperity? Over the past several years, shareholder proposals calling for the banks to stop all investments in oil and gas have been presented by activist shareholders and well-funded non-profit organizations.
To counter these, this year InvestNow stepped up and presented our own shareholder proposals to three Canadian banks, asking for explicit commitments to continue to invest in and finance Canadian oil and gas and to step away from policies that hurt the sector. This is the first time shareholder proposals of this nature have been presented to Canadian banks.
The shareholder proposal is one of the most common and most powerful tools available to influence corporate policy. Shareholders submit proposals for consideration at a corporation’s annual general meeting, allowing them to have a say in board direction and management positions and policies.
We believe strongly that our banks cannot be part of a scheme designed to strangle a sector of vital importance, not only to our citizens, but the democratic world. The Canadian oil and gas sector fuels our economy. It provides livelihoods not only for the hundreds-of-thousands across Canada who work in the sector, but the millions – that is all of us – who depend on it in so many ways.
Encouraging divestment puts our economy at risk. Moreover, it will result in the growing demand for oil and gas around the world being met by other less democratic, less environmentally responsible suppliers.
The dogmatic narrative that eliminating our oil and gas sector is going to somehow “help” Canada and reduce CO2 emissions couldn’t be more wrong. Over eighty percent of the primary energy needs of the world are met by oil, natural gas, and coal. Global demand is increasing, not decreasing. The International Energy Agency just reported that world oil demand is scaling record highs.
If our banks go down the divestment path, Canada will lose its ability to influence the global energy conversation and we will see direct hardship for everyday Canadians. Our economy will be hobbled, industry will shut down, people will lose their jobs, and energy poverty will grow.
Canadians live the way we do because we have one of the most productive, innovative, and responsible energy industries in the world. Our shareholder proposals called on the banks to come onside and to signal to the investment community, and to the world, that they are committed to the Canadian oil and gas sector. In fact, they have an economic and moral imperative to do so.
Nothing happens without oil and gas. This sector is essential for the functioning of the economy, for jobs, for innovation – and for global emissions reductions.
InvestNow will continue fighting for investment in Canada’s oil and gas sector through shareholder proposals and other work.
This article first appeared on the Canadian Energy Centre website on Aug. 25, 2023.
Gina Pappano is executive director of InvestNow Inc., a non-profit dedicated to demonstrating that investing in Canada’s resource sectors helps Canada and the world. Join the movement and pass the InvestNow resolution at investnow.org.