I work at Trans-Canada Capital Inc. (TCC) and we manage the assets of Air Canada Pension and other Institutional clients (over C$30 billion inclusive of leverage). The investment team used to be within Air Canada but since we wanted to have external clients, the team officially becomes TCC in 2019, a wholly-owned subsidiary of Air Canada and is now registered with the regulators across Canada.

We have 6 funds, 3 of which are managed internally (Fixed Income, Multi-Strategy), and 3 funds are funds of funds (Hedge Funds, Private Market and Liquid Alternative Strategies, and Equity). When possible, we are doing ESG integration with the funds.

TCC’s investment team has been managing Air Canada’s Canadian pension assets since 2009, but TCC is a new organization and registered with the regulator in Quebec since June 2018. In that context, my job is Chief Compliance Officer, and ESG leader or someone trying to oversee the ESG practices within the firm. 

Everything is new because as a pension fund before, we didn’t have all the regulatory parts, because we only had to manage the assets for the pension fund, but right now, as a registered asset manager, we do also have compliance and regulation rules to follow. My role was to build the compliance department and to build the ESG practices. On the compliance side there are some ESG regulations to monitor but on ESG practices side, my role is to make sure that the firm has ESG integration within the investment process and to have ESG integration at the corporate level, or in the firm itself.

For this question, I will focus more on the ESG practices side, not the compliance. 

It is interesting, because we are like a big start-up, so the first thing was to build the ESG practices and to do that, I had to build the roadmap for the firm. With the ESG roadmap, the first thing was to develop a sustainable investment policy, so I had to create a Sustainable Investing Committee. Within the Sustainable Investing Committee, we have members from different departments from across TCC. With the committee, we have developed the Sustainable Investment Policy and a Sustainability Proxy Voting Policy and Guidelines for the voting and engagement. That was part of the first step for the roadmap, but at the corporate level, we also created 2 committees, one for Diversity and Inclusion, and one for the Environment. They also have their own roadmap for next year for the firm. For the investment, part of our roadmap was also to be member of organization who has an ESG mandate like the CDP (the Carbon Disclosure Project). So, we are now a member of the CDP, member of the Responsible Investment Association of Canada (RIA), and signatory of the United Nation’s Principle for Responsible Investment (PRI).

Currently what we are working on is to launch a new Fixed Income Universe funds with ESG integration. We will have ESG constraint in the fund, and we will calculate the carbon intensity and footprint of the investments. TCC also want to be among the first in the world to adopt the CFA Global ESG Disclosure Standard for Investment Products with an independent certification from a CPA firm to make sure that we follow those standards. 

It is interesting, because when I talked to the audit firm that will audit the fund, the standards for the audit of this disclosure are still being drafted. The official audit standards are going to be released in May 2022.

Just by interest. I was always in compliance, I started in external audit and did my two years to get my CPA, CA, then with the Montreal Exchange I did regulatory examinations of brokerage firms. After that I continued on the compliance function for investment managers. So that’s how I started, as a CPA and in compliance, and then I heard more about ESG integration in investments. And when I was at Intact Investment Management, there was a project on ESG integration and I raised my hand and said I was interested in participating, and that is how it all started. When the head-hunter called me for an opportunity at TCC, they were at first looking only for a Chief Compliance Officer, but I told them that I was really interested in ESG. But since TCC was like a start-up, they were not doing anything on ESG. So, they created a new role for ESG and that’s how I landed with a job in compliance and ESG. I think what people should conclude on that is to have in mind is that you can create your own role in ESG, no matter which function or department you are at, you can always integrate ESG or sustainability within your job. It is just a matter of interest.

Not always, but with all that we have heard about climate change and ESG in the last several years, I have gotten more interested in having something to do with those subjects.

In the past few years, there are 2 that I have in mind. First is from the CFA Institute, they now have an ESG Investing certificate that they have just recently implemented which is pretty good for people who want to know more about ESG integration in investing. The second one is the International Sustainability Standards Board (ISSB) who will have an office in Montreal. Those are the most exciting news pieces recently in the industry. I think the ISSB will really be a game changer because it is going to be standardizing the ESG metrics and then you will have audits on those metrics.

Sometimes there is the misconception that when you do ESG Integration, you do not have the same performance. You can have the same performance potentially for less risk. This way you consider all the financial but also the non-financial considerations that are material because they always have an impact. More people are interested in investing into ESG funds or want to have ESG integration in the investment process, so maybe it is less today, but I think it was one of the misconceptions in the beginning.

There is no typical day at my level. You just try to manage all the projects you have and all the initiatives. For work life balance, it is up to everyone to make sure that you have the work life balance that you want. With the opportunity to work from home it is going to be much better for the work life balance in the coming years.

The most challenging part is trying to get the data for the ESG metrics that we need to calculate. For example, when measuring the carbon intensity of the portfolio, there are some companies that you really do not have any idea of what their GHG (Greenhouse Gas) emissions are. Also, making sure that you can rely on the data. The other one is keeping up with all the standards and regulation on ESG.

I do not have any for now.

For an analyst in investment compliance, someone who just completed their studies or have few years of experience, the role and responsibilities at TCC will be to ensure that the voting process for the Sustainable Proxy Voting Policy is followed and to complete the UN PRI and ask Force on Climate-related Financial Disclosures TCFD Reporting. Also, being able to calculate ESG metrics and carbon footprint intensity, and support TCC ESG practices. 

For qualification, any quantitative discipline (actuarial, math, accounting, finance) is good because we are in investments, and work with a lot of data. Knowing VBA, SQL, Python, Bloomberg are good assets to have in the investment industry. And analytical skills, autonomy, critical thinking, proactive, sense of initiative, communication, and teamwork skills.

At a more senior level, because we have to deal with a lot of stakeholders, there is more emphasis on communication, teamwork, and networking. Networking is more important the more senior you get. Networking with external people, but also internally with other departments or teammates. And when you have a team to manage, you need leadership skills.

In Sustainable Finance, you need something finance related. A bachelor’s degree in finance is usually the most common requirement to pursue a career in finance or the CFA designation.

Teamwork. You cannot work on your own, so that is something we really value. And being willing to learn as well. ESG is relatively new and constantly evolving, you have to read a lot, so having some interest on always learning.

Differently, no. I am happy with where I am. It is something that I did not really expect to do, but when you have an interest or something you are passionate about, just raise your hand and say it to your manager. Try to find something with that interest in your role or add your passion with your work.