Earlier today, Ontario Teachers’ announced the appointment of Christopher Metrakos as Executive Managing Director, Infrastructure & Natural Resources:

Toronto, Canada -- Ontario Teachers' Pension Plan Board (Ontario Teachers') today announces the appointment of Christopher Metrakos to the position of Executive Managing Director, Infrastructure & Natural Resources (INR), effective immediately. In this role, based in the Toronto office, Mr. Metrakos will be responsible for guiding INR’s strategy, portfolio, and asset management activities globally. 

Mr. Metrakos joined Ontario Teachers' in 2014 and most recently served as Senior Managing Director, Natural Resources, where he oversaw a global, diversified portfolio that spans agriculture, aquaculture, energy, metals, timberland, and natural climate solutions. Prior to joining Ontario Teachers’, he worked in the energy sector as well as in investment banking.

In his new role, Mr. Metrakos will become a permanent member of the Investments Senior Leadership Team and report to Gillian Brown, Chief Investment Officer, Public & Private Investments.

“Investments in infrastructure and natural resources play a critical role in providing the fund with diversifying returns, inflation protection, and stable cash flows that help pay pensions. Chris’s leadership, demonstrated success in driving strong investment returns, and sound judgement make him the ideal person to step into this pivotal role,” said Ms. Brown. 

Mr. Metrakos holds a Bachelor of Arts, with a major in Economics, from McGill University and is a CFA charterholder. He also has an ICD.D certification from the Institute of Corporate Directors.

About Ontario Teachers’

Ontario Teachers' Pension Plan Board (Ontario Teachers') is a global investor with net assets of $269.6 billion as at June 30, 2025. Ontario Teachers’ is a fully funded defined benefit pension plan, and it invests in a broad array of asset classes to deliver retirement security for 343,000 working members and pensioners. For more information, visit otpp.com and follow us on LinkedIn. 

Let me begin by congratulating Chris Metrakos on this important appointment.

Chris will be overseeing one of the most important asset classes at Teachers', taking over the role from Dale Burgess who was recently appointed the Head of Equities (Public and Private).

Chris is succeeding top people like Dale and before him Andrew Claerhout who preceded Dale and might have hired both of them (he definitely hired Dale).

Even though we both graduated from McGill Economics and have Greek roots, I never met Chris but I have tracked more than a few of his deals on my blog, most recently back in April when OTPP sold its remaining free cash flow stake in New Afton Mine (see comment here). 

He has a proven track record in natural resources and will now be in charge on Teacher's large infrastructure portfolio as well, one of the best institutional infrastructure portfolios in the world.

These two portfolios, natural resources and infrastructure, are complementary, they're both very long-term asset classes that offer important inflation protection to the plan and solid yields over the long run. 

Chris will be reporting to Gillian Brown, the CIO Public & Private Markets who again made the wise decision to promote from within (with Jo Taylor's stamp of approval, of course).

I'm a big believer of promoting from within a pension fund/ plan because if you have internal candidates, they already know the organization's culture and are going to hit the ground running. 

Bringing someone from the outside carries huge risks, most of the time it ends badly, seen it at OTPP and other large Canadian pension funds.

Always promote from within as long as you have the requisite talent and experience. 

Now, I know Dale and Chris are white males but I don't really give a damn about the DEI police, I want to see the right people at the right positions.

If Olivia Steedman was still part of OTPP's INR group, no doubt she would be the head now but she left to head up Teachers' Venture Growth. 

And if Andrew Claerhout was still at OTPP, no doubt in my mind, he would be a huge contender to succeed Jo Taylor at the next CEO.

I call it like I see it, I've had my fill on DEI cheerleading at the Maple 8, most of it is total nonsense. 

Don't get me wrong, I'm a sticker for DEI, real DEI, not window dressing nonsense but I also think you need to promote the right people in key spots regardless of their age, gender, religion, colour of their skin and disability (not that anyone disabled ever makes it to senior management positions at these places, more proof of DEI fluff). 

Alright, let me just end by once again congratulating Chris Metrakos for this important nomination.

Lastly, before I forget, Teachers' posted a great PE Real Assets interview on LinkedIn featuring their Global Head of Real Estate Pierre Cherki, alongside their Head of European Real Estate, Jenny Hammarlund, sharing how they are shifting priorities across sectors and regions to capture long-term growth and manage the cycle, while building a portfolio designed to deliver long term returns for their members. 

Click here to read that interview. 

All can say is both Pierre Cherki and Jenny Hammarlund are doing a great job diversifying Teacher's real estate portfolio internationally and Jenny has caught my attention a few times with the deals she's completed in Europe.

Alright, let me wrap it up there, I don't get paid enough t share my wisdom with all of you!

Below, Stewart Upson, Co-President of Brookfield Infrastructure in charge of APAC, discusses AI infrastructure with CNBC Squawk Box Asia. 

Listen carefully to his insights, Brookfield leads the crowd in infrastructure.

Overview of FLSD Certification

The FLSD certification is a crucial credential for fire and life safety roles, ensuring compliance with fire codes and preparing professionals for FDNY exams and on-site assessments in high-rise buildings, hotels, and commercial properties.

1.1 Importance of FLSD Certification

The FLSD certification is essential for ensuring fire and life safety in high-rise buildings, hotels, and commercial properties. It validates an individual’s knowledge of fire codes, emergency procedures, and safety protocols. This credential is critical for maintaining compliance with FDNY regulations and preparing for both written and on-site exams. The certification ensures that professionals can effectively manage fire emergencies, operate safety systems, and maintain required documentation. It also enhances credibility and competency in handling life-saving responsibilities, making it a vital requirement for Fire Safety Directors and Emergency Action Plan Directors. Proper certification ensures public safety and legal compliance in fire safety management.

1.2 Roles and Responsibilities of an FLSD

An FLSD is responsible for overseeing fire safety operations, including implementing emergency action plans and managing fire alarm systems. They conduct routine inspections, maintain log books, and ensure compliance with FDNY regulations. FLSDs must respond to emergencies, operate fire safety systems, and coordinate evacuations. They also train staff on safety protocols and handle incident reporting. Their role is critical in preventing fires and ensuring the safety of occupants in high-rise buildings, hotels, and commercial properties. Effective communication and decision-making are key to their success in protecting lives and property during emergencies.

F-89 Fire Life Safety Director (FLSD) Course

The F-89 course is an online certification program providing 31 hours of instruction on fire codes, emergency plans, and safety protocols to prepare for FDNY exams and on-site assessments effectively.

The F-89 Fire and Life Safety Director course is an essential 31-hour online training program designed to prepare individuals for FDNY certification. It covers critical topics such as fire codes, emergency action plans, and fire safety protocols. The course is structured to ensure comprehensive understanding and compliance with FDNY regulations. By combining theoretical knowledge with practical insights, the F-89 course equips students with the skills needed to handle fire and life safety responsibilities effectively.

2.2 Course Structure and Content

The F-89 course is a 31-hour comprehensive program structured to cover essential fire and life safety topics. It includes detailed modules on fire codes, emergency action plans, fire alarm systems, fire extinguishers, and suppression systems. The course also addresses means of egress, record-keeping, and incident reporting. Practical insights and real-world scenarios are integrated to enhance understanding. The content is designed to prepare students for both the written FDNY exam and the on-site assessment. By focusing on both theoretical knowledge and practical application, the course ensures that participants are well-equipped to handle the responsibilities of a Fire and Life Safety Director effectively.

2.3 Preparation for Written and On-Site Exams

Preparation for the FLSD exams requires a strategic approach. For the written exam, focus on mastering fire codes, emergency procedures, and regulatory requirements. Utilize practice tests to identify weak areas and reinforce understanding of key concepts. For the on-site exam, familiarize yourself with building systems, equipment, and evacuation routes. Conduct mock inspections and practice presenting emergency plans to build confidence. Combining thorough studying of course materials with hands-on practice ensures readiness for both exams. Organization and time management are critical to cover all topics effectively and perform well under exam conditions.

FLSD Exam Bank and Practice Tests

The FLSD exam bank provides access to practice tests and study materials. These resources simulate real exam conditions, helping candidates assess their knowledge and improve test-taking skills effectively.

3.1 Utilizing Practice Exams

Practice exams are essential for preparing for the FLSD certification. They simulate real test conditions, helping candidates assess their knowledge and identify weak areas. Regular use of practice exams improves time management, reduces test anxiety, and enhances familiarity with question formats. Candidates should review incorrect answers to understand mistakes and reinforce learning. Additionally, practice exams help refine test-taking strategies, such as prioritizing high-probability questions and managing time effectively. Consistent practice ensures a thorough understanding of fire safety protocols, codes, and emergency procedures, leading to better performance on the actual exam. This step is critical for achieving certification success.

3.2 Strategies for Effective Test Preparation

Effective test preparation for the FLSD exam requires a structured approach. Start by creating a detailed study plan, focusing on high-weight topics. Use active learning techniques, such as flashcards, to reinforce key concepts. Engage in group discussions to clarify doubts and gain new insights. Prioritize hands-on practice with past papers to familiarize yourself with the exam format. Simulate exam conditions during mock tests to improve time management and reduce anxiety. Stay organized, review notes regularly, and ensure a healthy work-life balance to maintain focus. By combining these strategies, you can maximize your readiness and confidence for the certification exam.

Fire Codes and Regulations

Fire codes and regulations are critical for ensuring safety and compliance. Understanding NYC fire safety standards, including the NYC Fire Code and FDNY regulations, is essential for FLSD certification.

4.1 Overview of Key Fire Codes

Key fire codes ensure safety and compliance in buildings. The NYC Fire Code, based on the International Fire Code (IFC), regulates fire safety standards. The International Building Code (IBC) and NFPA 101 (Life Safety Code) also apply. These codes cover fire prevention, detection, and suppression systems. They outline requirements for means of egress, fire alarms, and emergency lighting. Compliance with these codes is mandatory for all commercial and residential buildings. Understanding these codes is essential for FLSD certification, as they form the foundation of fire safety practices; Regular updates to these codes ensure alignment with current safety standards and technologies.

4.2 FDNY Enforcement and Compliance

The FDNY enforces fire safety regulations to protect lives and property. They conduct regular inspections to ensure compliance with fire codes and regulations. Buildings must maintain proper fire safety systems, including exits, alarms, and suppression equipment. Non-compliance results in violations, fines, or even closure. The FDNY also provides guidelines and bulletins to help building owners and managers understand requirements. Compliance involves maintaining records, performing routine inspections, and addressing violations promptly. Understanding FDNY enforcement is critical for FLSD certification, as it ensures adherence to safety standards and legal obligations. Staying informed about FDNY updates helps maintain compliance and public safety effectively.

Emergency Preparedness and Response

Emergency preparedness involves creating plans and training staff. Effective response includes evacuation routes, clear communication, and coordination with emergency services to ensure safety and efficiency.

5.1 Fire Emergency Action Plans

A Fire Emergency Action Plan (FEAP) is a critical document outlining procedures for emergency situations. It ensures occupants know evacuation routes, assembly points, and communication methods. The plan must be tailored to the building’s layout, occupancy, and fire safety systems. Regular drills and training are essential for familiarity. The FLSD and Emergency Action Plan Directors play key roles in implementation. The FEAP must comply with local fire codes and be updated annually or when significant changes occur. Proper signage and clear instructions are vital for effective execution during emergencies, ensuring occupant safety and compliance with regulations.

5.2 Role of Emergency Action Plan Directors

Emergency Action Plan Directors are responsible for overseeing the implementation and execution of the Fire Emergency Action Plan. They ensure that all occupants are familiar with evacuation procedures and safety protocols. Directors conduct regular drills, provide training, and maintain communication with building management and emergency services. They also review and update the plan annually or as needed. During an emergency, the Director coordinates the response, ensuring safe evacuation and compliance with fire safety regulations. Their role is critical in minimizing risks and ensuring the plan is effective. Proper documentation of drills and training is essential for compliance and continuous improvement.

5.3 Active Shooter and Medical Emergency Response

In active shooter situations, Fire Life Safety Directors (FLSDs) must integrate protocols into emergency plans. This includes evacuation procedures, shelter-in-place strategies, and communication methods. For medical emergencies, FLSDs should ensure first aid and CPR are administered promptly. They must coordinate with emergency services and maintain order. Proper training for staff is essential to handle such crises effectively. FLSDs must stay updated on best practices and regulatory requirements to ensure preparedness. Regular drills and training sessions are critical to enhance response capabilities and minimize risks during these high-stress situations. Effective communication and quick decision-making are vital to safeguarding lives and property.

Fire Alarm Systems

Fire alarm systems detect emergencies early, enabling timely evacuation. They include smoke detectors, heat detectors, horns, strobes, and control panels. Compliance with fire codes like NFPA 72 is crucial. Proper installation, testing, and maintenance ensure reliability and safety.

6.1 Components of Fire Alarm Systems

Fire alarm systems consist of essential components that work together to detect and alert occupants of potential fires. Key components include smoke detectors, heat detectors, manual pull stations, horns, strobes, and a central control panel. Detectors sense fire conditions, while manual pull stations allow for human intervention. Horns and strobes provide audible and visual alerts, ensuring evacuation. The control panel monitors the system, processes signals, and coordinates responses. Communication devices like DACTs (Digital Alarm Communicator Transmitters) connect to emergency services. Proper wiring, power supplies, and remote monitoring systems ensure reliability. Regular testing and maintenance are critical to ensure all components function effectively in emergencies.

6.2 Manual Pull Stations and Their Identification

Manual pull stations are critical components of fire alarm systems, enabling individuals to initiate an alarm in emergency situations. These devices are typically located near exits, stairwells, or in high-traffic areas for easy access. They are usually red in color with clear labeling, such as “PULL DOWN” or “PULL,” to ensure quick identification. When activated, they trigger the fire alarm system, alerting occupants and summoning emergency services. Proper identification involves ensuring stations are visible, unobstructed, and regularly inspected. Testing and maintenance are essential to guarantee functionality. Each pull station is uniquely identified for incident reporting purposes, ensuring accountability and system reliability.

Fire Extinguishers and Suppression Systems

Fire extinguishers and suppression systems are essential for controlling fires. Understanding types, proper usage, and maintenance is crucial for effective fire safety management.

7.1 Types and Uses of Fire Extinguishers

Fire extinguishers are categorized into classes based on the types of fires they can extinguish. Class A extinguishers are for ordinary combustibles like paper and wood, while Class B is for flammable liquids. Class C is designed for electrical fires, and Class D is for combustible metals. Class K extinguishers are specialized for cooking oils and greases; Multi-purpose extinguishers, such as those rated for A, B, and C fires, are commonly used in commercial settings. Proper selection and use of extinguishers are critical for effective fire control. Understanding the PASS method (Pull, Aim, Squeeze, Sweep) ensures safe and efficient operation.

7.2 Fire Suppression Systems

Fire suppression systems are designed to automatically detect and extinguish fires in their early stages, minimizing damage and risk. These systems are typically tailored to specific hazards and environments. Water-based systems are common in commercial spaces, while clean agent or inert gas systems are used in areas with sensitive equipment. Some systems, like pre-action and deluge systems, require manual activation or specific triggers. Proper installation, maintenance, and regular inspections are critical to ensure reliability. Understanding the operation and application of suppression systems is essential for fire safety directors to implement effective fire management strategies in various settings.

Means of Egress

Means of egress refers to the paths and ways people can exit a building safely during emergencies. Key components include exit signs, emergency lighting, and evacuation routes.

8.1 Exit Signs and Emergency Lighting

Exit signs and emergency lighting are critical for safe evacuation during emergencies. Exit signs must be clearly visible, illuminated, and compliant with fire codes. They should be placed at every required exit and along escape routes. Emergency lighting, including backup systems, ensures visibility when primary power fails. Proper installation, maintenance, and testing of these systems are essential to ensure reliability. FLSDs must verify that all exit signs and emergency lights function correctly and meet code requirements. Regular inspections and testing are necessary to maintain compliance and ensure occupant safety during evacuations.

8.2 Evacuation Routes and Procedures

Evacuation routes and procedures are essential for ensuring the safe and orderly exit of occupants during emergencies. Clear pathways must be maintained, and exits should be easily identifiable. The FLSD must develop and communicate evacuation plans, including primary and alternative routes, to all building occupants. Regular drills and training are crucial to familiarize everyone with the procedures. Emergency exits, stairwells, and assembly points should be clearly marked and accessible. The FLSD must ensure compliance with fire codes and regulations, such as those set by OSHA, to guarantee a safe evacuation process. Proper planning and enforcement of these procedures are vital for minimizing risks during emergencies.

Record-Keeping and Reporting

Accurate record-keeping is crucial for compliance and safety. The FLSD must maintain detailed log books, incident reports, and documentation of all safety-related activities. Proper documentation ensures accountability and preparedness for inspections and legal requirements.

9.1 Maintaining Log Books and Records

Maintaining log books and records is essential for fire safety compliance. The FLSD must document all fire safety inspections, equipment tests, and drills. Records should include dates, times, and details of activities. Logs must be updated regularly and retained for a specified period. Accuracy is critical to ensure compliance with FDNY regulations. Proper record-keeping helps track maintenance, identify trends, and provide evidence of compliance during inspections. Digital or physical log books must be accessible and organized. Consistent documentation practices ensure accountability and support effective emergency preparedness. Familiarity with record-keeping requirements is a key responsibility of the FLSD role.

9.2 Incident Reporting and Documentation

Incident reporting and documentation are critical for maintaining fire safety standards. The FLSD must promptly report any fire-related incidents to the FDNY and building management. Detailed documentation includes incident type, location, time, and actions taken. Reports must be accurate and submitted within required timelines. Documentation serves as evidence for investigations and compliance checks. Maintaining thorough records ensures transparency and accountability. The FLSD should also review and update incident reports to identify patterns and improve safety measures. Proper documentation supports legal compliance and enhances emergency response strategies. Accurate and timely reporting is a cornerstone of effective fire life safety management.

On-Site Examination Process

The on-site examination evaluates practical skills and knowledge. Candidates are assessed on equipment inspection, emergency response, and compliance with fire safety protocols. Preparation is key.

10.1 Requesting the On-Site Exam

To request the on-site exam, candidates must first meet eligibility criteria and complete the written exam. Applications are submitted through the FDNY website or in person. Required documents include proof of completion, identification, and payment. A fee is applicable, and processing times vary. Once approved, an inspector is assigned to conduct the assessment. Candidates are notified of the scheduled date and location. It is essential to review the inspection checklist beforehand to ensure compliance with all requirements. Failure to meet standards may result in delays or additional fees; Proper preparation and attention to detail are critical for a successful on-site evaluation.

10.2 Preparation for the On-Site Assessment

Preparation for the on-site assessment requires a thorough review of the FDNY inspection checklist. Ensure all fire safety systems, including alarms and extinguishers, are operational. Organize log books and maintenance records for easy access. Train staff on emergency procedures and evacuation routes. Conduct a mock inspection to identify and address deficiencies. Familiarize yourself with local fire codes and regulations. Test all safety equipment and ensure compliance with FDNY standards. Understand the roles and responsibilities expected during the assessment. Gather all necessary documents and certificates. Plan for potential scenarios the inspector may evaluate. Attention to detail and proactive preparation are key to a successful on-site evaluation.

Specialized Fire Safety Roles

Specialized fire safety roles include Fire Safety Directors and Emergency Action Plan Directors, ensuring compliance with safety protocols and managing emergency responses effectively.

11.1 Fire Safety Directors

A Fire Safety Director (FSD) oversees fire safety operations, ensuring compliance with fire codes and regulations. They conduct regular inspections, train staff, and develop emergency response plans. The FSD coordinates evacuation procedures, maintains fire safety equipment, and communicates with authorities during incidents. Their role is critical in preventing fires and minimizing risks. Effective FSDs stay updated on fire safety trends and regulations, ensuring a safe environment for occupants. They also collaborate with other safety personnel to maintain preparedness and respond to emergencies efficiently. Their expertise is vital for safeguarding lives and property in high-rise buildings and complex facilities.

11.2 Emergency Action Plan Directors

An Emergency Action Plan Director (EAPD) is responsible for developing, implementing, and maintaining emergency response plans. They ensure that all occupants are prepared to respond safely during emergencies. The EAPD conducts regular drills, trains staff, and updates plans to reflect building changes or new regulations. They coordinate with fire safety directors and other stakeholders to ensure a unified response. During an emergency, the EAPD directs evacuation procedures, communicates with emergency services, and oversees incident management. Their role is essential for minimizing risks and ensuring a swift, organized response to emergencies, protecting both people and property.

Additional Resources and Exam Preparation

Utilize study guides, online courses, and practice exams to enhance knowledge. Focus on fire safety codes, emergency procedures, and exam strategies to ensure comprehensive preparation and success.

12.1 Recommended Study Materials

Essential study materials include the official FDNY Fire Life Safety Director study guide, which covers fire codes, emergency procedures, and safety protocols. Online courses and video tutorials provide interactive learning experiences. Practice exams and question banks help assess readiness. Additionally, textbooks on fire safety, emergency response, and building codes are valuable resources. Utilize FDNY-approved study guides and reference materials to ensure alignment with exam content. Supplementary resources like flashcards and study groups can enhance retention and understanding. Prioritize materials that focus on practical scenarios and real-world applications to build confidence and competence for the certification exam.

12.2 Final Tips for Exam Success

To excel in the FLSD certification exam, prioritize time management by focusing on high-weight questions first. Thoroughly understand fire codes and regulations, as they form the core of the exam. Practice applying knowledge to real-world scenarios to enhance problem-solving skills. Stay calm and methodical during the test to minimize errors. Review all answers before submitting, ensuring accuracy. Arrive early to the exam location and familiarize yourself with the setting. Stay confident and rely on your preparation. A well-organized study plan and consistent practice are key to achieving success in the FLSD certification exam.

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Layan Odeh and Lu Wang of Bloomberg report US Treasury bonds are at risk of losing their haven status should US fiscal stress continue to build, according to CPP Investments' Manroop Jhooty:

US Treasury bonds are at risk of losing their haven status should US fiscal stress continue to build, according to Canada Pension Plan Investment Board.

“We worry that if the fiscal scenario continues for a period of time” the Treasury market could stop being a haven, Manroop Jhooty, the pension plan’s head of total fund management, said in an interview. 

The remark comes as the US government shutdown over fiscal spending drags on and market participants increasingly sound warnings over the dollar’s fate.

The pension plan, which manages C$731.7 billion ($524.3 billion), invests across several asset classes globally, and considers bonds to be “good diversifier in any asset allocation strategy,” Jhooty said. For now, CPPIB is sticking to its US exposure, with the country making up roughly half of its holdings.

But the concern about the long-term fiscal situation in the US is that Treasuries could begin “to lose this diversification effect because it looks more and more like a risky asset and less and less like a risk-free asset,” he said. 

Billionaire investors are worrying that gold is increasingly seen as safer than the US dollar. Ray Dalio said earlier that gold is “certainly” more of a haven than the US dollar and that the bullion rally is reminiscent of the 1970s, when it surged during a time of high inflation and economic instability. 

Dalio’s comments echo those of Citadel’s Ken Griffin, who said gold’s rise reflects anxiety about the US currency. 

The dollar has weakened against every major currency this year after the uncertainty unleashed by President Donald Trump’s trade war sent it into the biggest slide since the 1970s, not long after the US abandoned the gold standard.

In the meantime, the US federal government shutdown and speculation that the Federal Reserve will keep cutting interest rates has pushed the price of gold up by more than 20% since the end of July, to roughly $4,000 an ounce. 

While the Toronto-based pension plan thinks the US Treasury market has held up better than its counterparts in the UK and Japan, where similar fiscal angst exists, “certainly gold has been a beneficiary as an alternative store of risk-free assets,” Jhooty said, adding that European currencies such as the Swiss franc are other “stores of value.”

I really don't know why Bloomberg harped on these comments because as you'll see below Manroop's discussion was a lot broader than US Treasuries, really delving deeply into total fund management and what they do.

He goes over what the total fund management group at CPP Investments' does and makes the distinction between what they do from a top down perspective relative to a bottom up perspective where investment teams investing in private credit, private equity and other assets are taking tactical opportunities. 

From a top down perspective, they're focused on big themes like AI, deglobalization and bilateral trade blocks, reshoring vs offshoring, fiscal deficits across the globe. 

He questioned whether bonds will remain the great diversifier in a world where deficits are exploding around the world.

He did say there is an opportunity on the fiscal side if deficits are used to make investments in nation building giving Germany as an example where they announced big infrastructure projects.

Lastly, he talked about macro headwinds like weakening labour markets, a bifurcation of the US consumer where the top 10% dominate consumption and said there are tailwinds but macro headwinds are counterbalancing them.

Public vs private markets, he said they need enough liquidity in the balance sheet to move where the opportunities are. He said they focus on relative value in public vs public markets and break down IRRs to really think about opportunities and where capital is best deployed.

He also said private equity allocation ballooned post-Covid because of market dynamics as IPOs and sales to strategics slowed and recently they have been able to dispose of assets (secondaries also played a big role there as CPP Investments sold a lot of funds stakes last year).

Lastly, he said they are very bullish on Canada where there is unanimous political will for nation building to build major projects.

Anyway, take the time to listen to Manroop, he's s smart guy and great communicator.

Below, Manroop Jhooty, Senior Managing Director & Head of Total Fund Management, CPP Investments discusses how the pension fund is navigating today's market landscape with Bloomberg's Amanda Cantrell at the 2025 Bloomberg Canadian Finance Conference in New York.

Also, Caitlin Gubbels, Senior Managing Director and Global Head of Private Equity at CPP Investments, discusses the rise of the secondaries market, and how the Fund is backing Canada’s AI ecosystem.

Caitlin discusses how important secondaries have become to manage their PE portfolio, manage liquidity and diversify vintage year risk (that's what it's all about in PE).

Lastly, Brandon Weening, Executive Vice President, Corporate & Capital Markets Finance, OMERS discusses the Canadian public pension fund's investment priorities with Bloomberg's Chunzi Xu at the 2025 Bloomberg Canadian Finance Conference in New York. 

Brandon is another really smart guy really worth listening to.

Bloomberg reports Goldman’s Verdalia raises €671 million to fund biomethane plants: 

Verdalia Bioenergy, a biomethane firm backed by Goldman Sachs Group Inc., has raised €671 million ($785 million) of debt from a large banking consortium to fund projects across Spain and Italy.

The corporate financing will help the company increase its aggregate production capacity to more than 3 terawatt hours per year, equivalent to the yearly consumption of almost 1 million households, according to a statement reviewed by Bloomberg News.

The new financing, covering biomethane plants construction as well as acquisitions, was provided by a group of banks: ING Groep NV, Societe Generale SA, UniCredit SpA, BBVA SA, Sumitomo Mitsui Banking Corp., Banco Santander SA and Banco de Sabadell SA. Investors La Caisse and Rivage also participated.

Biomethane, a renewable gas that can be made from food and animal waste or other organic matter, is supported by European government incentives to achieve carbon neutrality by 2050, spurring investment by companies such as Shell Plc and TotalEnergies SE.

Verdalia has seven plants in operation and six under construction in Italy, which are expected to start injecting biomethane into the grid in early 2026. In Spain, Verdalia is currently building its first plant and will start constructing two additional facilities by the end of this year.

Rothschild & Co. acted as financial adviser for the transaction. 

Ashurst also notes it has advised Verdalia Bioenergy Limited in one of the largest biomethane financing operations in Europe:

Ashurst has advised Verdalia Bioenergy Limited, as legal counsel in the closing of a landmark €671m financing, one of the largest financings in the European biomethane sector to date and first corporate infrastructure financing deal for a largely greenfield company.

In this deal, Verdalia Bioenergy Limited, the biomethane company backed by Goldman Sachs Alternatives’ infrastructure fund, has secured a €671 million financing for the acquisition and development of biomethane production portfolios in Spain and Italy with a combined capacity in excess of 3 TWh/year, equivalent to the annual consumption of nearly one million households.

The total capital to be deployed in the portfolio will exceed €1 billion. The financing, structured to provide strategic flexibility, will cover biomethane plants construction as well as acquisitions, giving Verdalia the tools to pursue both greenfield and brownfield growth over the next four years.

The transaction was supported by a consortium of leading international banks – ING, Société Générale, UniCredit, BBVA, SMBC, Santander and Sabadell – alongside global investment group La Caisse and Rivage.

The Ashurst Spanish team was led by partners Irian Saleta Martínez (Banking and Finance), Andrés Alfonso (Energy Transition) and Nicholas Pawson (English Law Finance). The team was supported by associate Ignacio Piñeiro and trainee Mercedes Fernández-Montes from the Banking and Finance department, associate Pedro Díaz from the Energy Transition team and senior associates Sam McLernon and Kalin Ivanov, associates Stephanie Simm and William Lotter, and trainee Hanna Smyk, all the latter from our English Law Finance team in Madrid. Tax matters were overseen by partner Ricardo García-Borregón and associate Enrique Muñoz.

The Ashurst Italian team was led by partner Carloandrea Meacci, assisted by counsel Nicola Toscano, senior associate Mariavittoria Zaccaria, and associate Stefano Tallamona in relation to the transactional aspects of the financing. Legal due diligence was handled by partner Elena Giuffrè, supported by senior associate Gianluca Di Stefano, associates Michela Bardelli, Marta Simoncelli, Francesca Sala, Marco Messina, Alessio Lisanti, Cecilia Bertanzetti, and trainee Matteo Perrone. Tax matters were overseen by partner Michele Milanese, with the support of associate Leonardo Sabatini and trainee Pier Paolo Capponi. 

Earlier today, La Caisse issued a press release stating Verdalia Bioenergy closes €671m landmark corporate financing to accelerate biomethane portfolio across Spain and Italy:

• One of the largest financings in the European biomethane sector to date and first corporate infrastructure financing deal for a largely greenfield company
• €671m fully committed package to support the development of a portfolio with a combined capacity in excess of 3 TWh/year
• Backed by a club of leading domestic and international banks and institutional investors

Verdalia Bioenergy today announced the closing of a landmark €671 million corporate financing, the first and largest of its kind in the European biomethane sector. The transaction will support the company’s investment plan to build and operate a portfolio of projects across Spain and Italy with an aggregate production capacity in excess of 3 TWh per year – equivalent to the annual consumption of nearly one million households. The total capital to be deployed in the portfolio will exceed €1 billion.

The financing, structured to provide strategic flexibility, will cover biomethane plants construction as well as acquisitions, giving Verdalia the tools to pursue both greenfield and brownfield growth over the next four years.

The portfolio already includes seven plants in operation and six under construction in Italy, which are expected to start injecting biomethane into the grid in early 2026. In Spain, Verdalia is currently building its first plant and will commence construction of two additional facilities before the end of this year.

The transaction was supported by a consortium of leading international banks – ING, Société Générale, UniCredit, BBVA, SMBC, Santander and Sabadell – alongside global investment group La Caisse and Rivage. Rothschild & Co acted as exclusive financial adviser.

Fernando Bergasa, Co-founder, Chairman and CEO of Verdalia Bioenergy, said:

“This milestone constitutes a big leap forward for Verdalia and for the biomethane industry in Europe. It demonstrates the trust of top-tier financial institutions in our strategy and underlines the role that renewable natural gas will play in achieving decarbonisation targets and energy independence.”

Matteo Botto Poala, Managing Director in Infrastructure at Goldman Sachs Alternatives and board member of Verdalia, added:

“We are proud to support Verdalia in this landmark transaction. This financing validates the ability to attract infrastructure capital into the biomethane sector and highlights the scalability and resilience of biomethane as a core pillar of Europe’s energy transition.”

Verdalia Bioenergy was advised by Rothschild & Co as exclusive financial adviser and Ashurst LLP as legal counsel. The lenders were advised by Latham & Watkins LLP. Palmer Agency Services acted as Agent.

Technical due diligence was provided by AFRY, commercial due diligence by BCG, ESG due diligence by ERM, insurance due diligence by Aon, and financial & tax due diligence by EY. 

About Verdalia Bioenergy

Verdalia Bioenergy Ltd was founded in early 2023 by Fernando Bergasa and Cristina Ávila, together with the Infrastructure fund of Goldman Sachs Alternatives. Verdalia aims to invest over €1 billion in developing, building or acquiring and operating large assets to become one of the leading pan‑European biomethane operators.

About Goldman Sachs Alternatives

Goldman Sachs (NYSE: GS) is one of the world’s leading alternative investors, with more than $450 billion in assets under management. Established in 2006, Infrastructure at Goldman Sachs Alternatives has consistently navigated the evolution of the infrastructure asset class, having invested over $16 billion since inception. The business partners with experienced operators and management teams across multiple sectors, including energy transition, digital infrastructure, transportation and logistics, and circular economy.

This is a huge financing deal where La Caisse joined top international lenders to help Verdalia Bioenergy grow its operations in Europe.

 According to the press release, the transaction will support the company’s investment plan to build and operate a portfolio of projects across Spain and Italy with an aggregate production capacity in excess of 3 TWh per year – equivalent to the annual consumption of nearly one million households. The total capital to be deployed in the portfolio will exceed €1 billion.

Moreover, the financing, structured to provide strategic flexibility, will cover biomethane plants construction as well as acquisitions, giving Verdalia the tools to pursue both greenfield and brownfield growth over the next four years. 

Verdalia is growing fast. Last year, it acquired 7 biomethane plants in Italy from Green Arrow Capital and Lazzari & Lucchini

This deal accelerates Verdalia’s development in Europe and further contributes to the country’s decarbonisation and energy independence agenda. The transaction will allow Verdalia to become one of the largest operators of agricultural biomethane plants in Italy.

London, 21st May 2024 – Verdalia Bioenergy, a European biomethane company founded by the infrastructure funds of Goldman Sachs Asset Management, Fernando Bergasa and Cristina Ávila, has agreed to acquire a portfolio of operating biomethane plants in Italy (the “portfolio”) from funds controlled by Green Arrow Capital, a leading Italian alternative investment manager, and Lazzari & Lucchini, a leading energy developer, subject to the completion of certain standard conditions for this type of transaction.

The portfolio consists of 7 plants located in the province of Brescia, with an approximate combined production capacity of 190 GWh of biomethane derived from a processing capacity of 350,000 tonnes of raw materials per year, with scope to expand by more than 50%. The plants have started operations at different dates in the 4 last years and produce biomethane solely through the processing of animal residues and agricultural by-products not intended for human consumption. The portfolio will help to avoid approximately 65,000 tonnes of greenhouse gas emissions per year.

Verdalia Bioenergy was launched in February 2023 by Fernando Bergasa and Cristina Ávila, executives with a strong track record of value creation and operational excellence in the natural gas sector, in partnership with Goldman Sachs Asset Management with the aim of investing by 2026 in excess of €1 billion to develop, acquire, own and operate biomethane plants across Europe. In March 2023, Verdalia completed its first acquisition of a portfolio of biomethane projects under development in Spain, with a total capacity of around 150 GWh/year. Since inception, Verdalia has made significant progress, with a team of 50 people today and a pipeline of mid- to late-stage development projects in Spain and Italy in excess of 2.5 TWh.

The acquisition of the portfolio solidifies Verdalia’s presence in Europe and positions the company as one of the leading biomethane players in the continent with a high-quality infrastructure business model. Verdalia will look into expanding the portfolio’s production capacity and monetising the by-products including bio-fertiliser and biogenic CO2 under offtake agreements. Verdalia continues to seek new opportunities to expand by acquiring projects in operation and under development, establishing partnerships with EPCs and long-term agreements with offtakers and feedstock providers, while growing its team.

Fernando Bergasa, Co-Founder, Chairman and CEO of Verdalia Bioenergy, added: “We are very pleased with the progress made in the past twelve months: we have initiated the development of an extensive portfolio of projects in Spain, built a very strong team and entered a new market, Italy. We believe Italy is at the forefront of the European decarbonisation agenda through biomethane with a supportive regulatory framework and are proud to demonstrate our commitment to the country’s energy transition plan through this important investment”.

Cristina Ávila, Co-Founder, President and COO of Verdalia Bioenergy, said: “The portfolio we are acquiring comprises 7 biomethane plants, and will be the stepping stone towards building strong operations in Italy. We continue to develop our expansion in Europe as we embark on this exciting chapter for Verdalia”.

Matteo Botto Poala, Managing Director in the Infrastructure business within Goldman Sachs Asset Management, commented: “We are excited about the progress made by Verdalia, demonstrating once again Goldman Sachs Asset Management’s track record in being an early mover in investing in energy transition and scaling up successful platforms. We look forward to continuing to invest in European biomethane and attract talent to work with Verdalia’s top class management team”.

Biomethane (also referred to as renewable natural gas or RNG) is a negative or low carbon natural gas produced through the anaerobic digestion of organic waste. As a result, it is an effective tool to accelerate decarbonization; it provides the benefits of fossil natural gas without its carbon emissions while leveraging the large gas infrastructure already in place. The environmental benefits of biomethane are amplified as it prevents methane emissions that could otherwise be released into the atmosphere from the decomposition of organic waste.

Advisors

For this acquisition Verdalia Bioenergy was advised by Intesa Sanpaolo (M&A), Ashurst (legal), EY (financial and tax), Ramboll (technical and commercial) and ERM (environmental). Green Arrow and Lazzari & Lucchini were advised by MFZ Partners (M&A) and Parola Associati (legal).

Clearly Fernando Bergasa and Cristina Ávila (featured at the top of this post) know what they're doing which is why Goldman Sachs Asset Management help fund their biomethane company. 

As noted in the first article above, biomethane is a renewable gas that can be made from food and animal waste or other organic matter, and is supported by European government incentives to achieve carbon neutrality by 2050, spurring investment by companies such as Shell Plc and TotalEnergies SE.

It's an important component in achieving carbon neutrality and La Caisse is now financing these leading European firm to help grow its operations.

This deal shows you how La Caisse is investing in sustainable energy through many channels including financing deals, partnering up with leading global banks and investors.

Below, biomethane can be made of organic waste, like manure, food scraps or damaged crops, and is therefore a modern way of waste management. To REPowerEU and decarbonise our economy, the EU has set an ambitious, but realistic, target to produce 35 billion m2 of biomethane per year by 2030. Learn more about the benefits of biomethane – one of the main renewable gases of the future.

Also, biomethane, also known as renewable natural gas (RNG), is a clean and sustainable form of energy produced from biogas through a purification process. Biogas is generated from the anaerobic digestion of organic materials such as agricultural residues, animal manure, food waste, wastewater sludge, and dedicated energy crops. The production of biomethane involves several key steps like anaerobic digestion and biogas purification (watch the second clip below).

In a government shutdown, hundreds of thousands of federal workers are on leave without pay for the duration of the shutdown (and possibly worse, if the threatened layoffs occur). If history is a guide (though no guarantee), federal workers will receive back pay after the shutdown ends, but often federal contractors do not. But federal workers aren’t the only ones who go through periods of not being paid while they’re employed. Thousands of workers go without pay every year when they need to take sick time to care for themselves and their families. While the number of workers with access to paid sick time has markedly improved over the last decade because of state and local action, access remains highly unequal, depending on where workers live and how much they are paid.

Access to paid sick leave is increasing in some areas

On a national level, we’ve seen positive trends in access to paid sick days from 63% of private-sector workers in 2012 to a record high of 80% in 2025, according to the latest data from the Bureau of Labor Statistics. These advances are driven by the fact that state and local governments enacted laws to enable workers to earn paid sick leave. In 2024, ballot measures were passed in Alaska and Nebraska. Alaska’s leave policy took effect on July 1, while Nebraska’s took effect just last week (albeit weaker than originally passed). Unfortunately, a paid sick leave measure that Missouri voters overwhelmingly approved by ballot was rolled back by the legislature and is no longer in effect.

Currently 18 states (including Washington, D.C.), 17 cities, and 4 counties have some form of paid sick leave requirements. Given that the existence of state laws varies, it’s no surprise that there are significant differences in access to paid sick time across the country, as shown in Figure A. The share of workers with access to paid sick days ranges from only 63% in the East South Central states (Alabama, Mississippi, Kentucky, and Tennessee) and 71% in the West South Central (Arkansas, Louisiana, Oklahoma, and Texas) up to 98% in the Pacific states (California, Oregon, Washington, Hawaii, and Alaska). The fact that the nearly 30 million workers in the Pacific states have essentially universal access to at least some form of paid sick days highlights that this key labor standard is purely a policy choice—and one that state and local governments can enforce on their own.

Figure A

Notably, many state governments in the East South Central and West South Central Census divisions have passed preemption laws prohibiting local municipalities from passing paid sick leave policies. So not only have legislative majorities failed to enact paid sick leave at the state level, but these states have also blocked cities and counties from passing legislation to provide paid sick leave for their workers.

Access to paid sick leave is greatest for the most highly paid workers

As with geographic variation, access to paid sick leave remains vastly unequal by wage level. As shown in Figure B, the higher the wage, the greater the access to paid sick leave. Among the 10% of private-sector workers with the highest wages, 96% have access to paid sick days. By contrast, among the 10% of workers with the lowest wages, only 41% have access to paid sick days.

Figure B

The unequal access to paid sick days is particularly troubling since low-wage workers are least able to absorb lost wages when they or their family members are sick. Workers may have trouble paying for housing, food, health care, and other necessities (see Table 1 of this report). This unequal access is why state laws are so important: Most of the gains from state and local paid sick provision benefited the lowest-wage workers. Access for the bottom 10% of wage earners increased from 19% in 2012 to 41% in 2025.

There is also huge variation in access to paid sick days within the private sector for workers by work hours and union status. Full-time workers are much more likely to have paid sick days than part-time workers (88% versus 56%). Unionized workers have greater access to paid sick days than nonunion workers (86% versus 80%).

Fortunately, there is a relatively simple way to address some of these inequities: The federal government can pass legislation to mandate paid sick leave for all workers. In the absence of federal action, state governments can move on their own and mandate that employers provide this key labor standard. Paid sick leave not only helps reduce the transmission of disease, it also provides economic security for workers who might otherwise lose income if they have to take time off from work. 

Chris Hall of Sustainable Investor caught up with UPP's CEO Barbara Zvan to discuss how to build a sustainable pension plan from scratch :

In 2020, Barbara Zvan took on a unique challenge, becoming the first CEO and President of the University Pension Plan Ontario (UPP). While most pension plan CEOs have faced the challenge of integrating ESG factors into their investment plans and business models, Zvan had the opportunity to build them into the foundations. 

But her approach was also informed from the lessons learned of a long career at the interface of investment, business and government. Before joining UPP, Zvan had spent 25 years at the Ontario Teachers’ Pension Plan (OTPP), rising to the post of Chief Risk and Strategy Officer.

She also sat on the Canadian federal government’s Expert Panel on Sustainable Finance, its Sustainable Finance Action Council (SFAC) – an advisory body consisting of Canada’s 25 largest financial institutions – and now plays a leading role at Climate Engagement Canada (CEC). 

Direct value creation

A defining characteristic of larger Canadian pension schemes such as OTPP is their willingness and ability (often enshrined in founding mandates) to make direct investments in partnership with asset managers. Co-investments appeal to pension funds, explains Zvan, by helping to improve the risk and return profile of large-scale, long-term investments. 

“We were able to get exposure to inflation protection, for example, through the infrastructure and real estate portfolio. It gave us the ability to be on boards to influence value creation and risk management. That’s important because these pension plans have to take risk to meet their liabilities and to keep it affordable,” she says. 

Now Zvan is looking to leverage the experience of OTPP and other larger Canadian pension plans at UPP, which has a much smaller pool of assets (C$13 billion; US$9.5 billion). UPP initially provided pension plans to three universities, adding new clients at a rate of one a year since. 

To explore the case, Zvan co-authored a paper that analysed how Canada’s C$200 billion-plus AUM pension schemes used their resources and expertise to capture value through co-investments while addressing four groups of risk: concentration and reputation risk; operation and development risk; government interference; and weak governance structure. 

One example cited is Caisse des Dépots et Placements du Quebec’s investment in Montreal’s new metro system, during which the pension fund leveraged relationships with government, contractors and the public to help ensure stakeholder buy-in at the land expropriation stage, minimising costs and delays that could have compromised long-term returns. 

Along with schemes of a similar size to UPP, Zvan is exploring how co-investing can still offer advantages – but with a twist to the existing model. Sector expertise is important, partly to be able to make the right choices, she says, but also to demonstrate the credibility in the market to ensure plans are offered the deals that offer the best fit. 

“One of the key risk management attributes of doing private markets deals that you are tied into for a long time is having that deep sector expertise upfront in your risk management and your assessment,” she says.

UPP has focused on mid-market transactions, partly to avoid competition with large rivals, in sectors such as infrastructure – focused on climate-aligned solutions, including both green and transition assets – residential and industrial real estate in developed markets, as well as buy-out opportunities. 

The key, says Zvan, is investing in “institutional knowledge” over the long term.

“To keep that partnership with the general partner (GP) going, you need a really strong pit crew. These deals don’t happen just by the investor teams alone. You need a strong legal group, tax group, operational due diligence group, and responsible investment group,” she adds. 

Access to derivatives and synthetic securities was also a key prerequisite, the report observed, to enable smaller funds to supply liquidity at short notice.

ESG as talent attractor

Operational from July 2021, ESG factors were built into UPP’s approach “from the get-go”, rather than integrated into existing processes. Although UPP did inherit managers and portfolios from their founding three clients, there were no common technologies or policies, giving Zvan and team carte blanche to build from the ground up.   

Internally, this meant hiring the people with the right skills and capabilities, as well as implementing thorough due diligence upfront. 

“Everyone we hired is very aligned to what we’re trying to do around the integration of material ESG factors into the investments. We would say it’s a talent attractor,” says Zvan. 

Externally, it meant working with managers that bought into UPP’s climate investment transition framework, and were willing to go on a journey of ongoing improvement. 

Not only should managers regard climate as a systemic and financially material risk, and make some kind of measurable net zero commitment; UPP also asks them to identify areas of improvement on an annual basis, by leveraging an industry benchmark, for example, or addressing an aspect of their governance structure. 

“It’s continual and it’s to ensure progress,” says Zvan. 

Inevitably, UPP’s priorities have evolved as its assets have grown – focusing initially on balancing asset mix and securing inflation protection – with its panel of managers shifting accordingly. In parallel, the plan has moved away from pooled to segregated vehicles, in order to exercise greater control and influence, particularly from a sustainability perspective. 

“This is something we’ve been doing quietly in the background, so we can vote the way that we want, exclude the way we want and engage directly with companies,” Zvan says. 

UPP’s approach has been commended in the latest Canadian Pension Climate Report Card, published annually by Shift, a charity. The plan was awarded a B+ ranking, based partly on meeting its 2025 emissions intensity reduction target a year early, but also the robustness of its climate stewardship and climate transition investment frameworks. 

Shift nevertheless encouraged UPP to include time-bound criteria and reinforce escalation as part of its Paris-aligned, outcomes-based climate engagement activities, as well as setting tougher expectations, backed up by climate-related resolutions or votes against directors. It also called on the plan to strengthen its fossil fuel exclusions, including a commitment to a “time-bound and managed phase-out of existing fossil fuel assets”. 

Climate collaboration

To meet its target of reaching net zero financed emissions by 2040, UPP has been engaging with portfolio companies on climate and other sustainability issues directly and via a number of collaborative fora, both domestic and internally focused. 

For a relatively small scheme to manage the impact of its investments on the climate, partnership with other investors is essential, asserts Zvan. As well as CEC, UPP has worked with the Institutional Investors Group on Climate Change and Climate Action 100+. The common thread of the initiatives in which they participate is a clear and well-understood area of focus, she says. 

Another critical success factor for collaborative initiatives is flexibility, says Zvan. “One size does not fit all; maintaining flexibility in how they participate and how they contribute is key,” she observes. 

The three initiatives cited all include asset managers in their membership, who are both competitors and subject to obligations to shareholders and a network of regulators. Asset owners may not be competitors, but are subject to similar considerations, also differing according to factors such as culture and investment horizon. In the case of CEC, the initiative has expanded to include international investors alongside domestic ones, the better to present a range of perspectives to high-emitting corporates. 

Zvan says collaborative investor initiatives must regularly review the effectiveness of their support for the engagement teams of participating institutions, including by monitoring impact. This involves close coordination but also “deep dive research” into targeted areas such as capex alignment. 

“You have to measure progress. The benchmark assessment element of these initiatives is so important,” she says. 

UPP has also stepped up its bilateral engagement and stewardship capabilities, as part of its efforts to encourage portfolio firms to maintain momentum across climate-related governance, strategy, targets and disclosures. 

A significant step this year was the filing of a shareholder resolution at Alimentation Couche-Tard, asking the Quebec-based retailer to disclose an emissions reduction strategy. The resolution, which follows an extensive engagement process, asked the firm to set medium-term targets for material Scope 1 and 2 emissions reductions, in line with its peers, as well as setting out its approach to tackling Scope 3 emissions. 

In early September, more than a fifth of independent shareholders in Couche-Tard supported UPP’s resolution, making it the most supported climate-related proposal at the firm in seven years. 

“Couche-Tard has already acknowledged that its fuel and energy business faces material risks from the ongoing transition — including regulatory changes, shifting market demand, evolving technologies and changing consumption patterns — but management isn’t telling shareholders how it intends to manage these risks,” said Sarah Couturier-Tanoh, Director of Shareholder Advocacy at the Shareholder Association for Research and Education, which co-filed the resolution. 

UPP is also increasing its scrutiny of directors, monitoring their effectiveness at overseeing climate risk, and reserving the right to vote against them at future AGMs if they fall short. “That’s a very powerful tool,” says Zvan. 

Systemic engagement 

The importance UPP places on stewardship stems from its investment beliefs, which include the principle that UPP’s ability to deliver returns to beneficiaries depends on healthy and functioning financial, social and environmental systems. 

This implies a system-based approach to stewardship which emphasises the role of government in creating an enabling policy environment that encourages the private sector to address systemic risks, such as climate change.  

Zvan believes governments are moving too slowly, to the detriment of carbon-intensive sectors and firms that struggle to profitably transition to net zero. But her work on Canada’s SFAC has deepened her understanding of the “different worlds” inhabited by the public and private sectors, as well as the size, complexity, and fragmented nature of government.

Effective engagement with government requires “an appreciation of what they’re up against,” says Zvan. “Continuous sharing back and forth is important,” she adds, allowing that this need is more evident in Canada, where the federal system requires as many as 30 separate rule changes in order to implement, for example, a country-wide approach to sustainability disclosures. 

“Local investors can provide insight, but it’s really important for the government to hear from the foreign investors too,” Zvan adds.

It’s not just dealing with regulators in 13 provinces that makes it hard to align Canada’s economy with net zero and planetary boundaries. The country has long relied on its extractive and often carbon-intensive industries for growth and jobs, contributing more than 8% to GDP in 2024. 

This means policy action and clear guidance to major industries are particularly important. Canada’s scorecard is mixed in terms of providing the signposts to a more sustainable economy, such as a taxonomy that helps investors to support firms in transition. 

Last December, the Canadian Sustainability Standards Board (CSSB) adopted the International Sustainability Standards Board’s climate and general sustainability disclosure  standards late last year. The Office of the Superintendent of Financial Services’ B-15 regulation, updated in February to conform with CSSB standards, lays out clear expectations for federally-regulated financial institutions. SFAC’s recommendations, including on a transition-focused taxonomy, have been adopted. Prime Minister Mark Carney expects the taxonomy to be effective for Canada’s most carbon-intensive sectors next year. 

Governance and oversight of transition guidance remains an issue, suggests Zvan, seeing a need for a permanent body, independent from government, to engage with the private sector on transition planning. 

Less positively, the Canadian Securities Administrators, which is the coordinating body for the country’s securities regulators, has put on hold disclosure requirements for public companies, favouring voluntary adoption instead. Geopolitical headwinds have not helped, acknowledges Zvan. 

“The trade issues are real. Canada exports a significant amount, much more than the UK and Europe, to the US. And so that is taking up a lot of time and attention for corporations, for financial institutions, as well as our federal government. The reality is, we have to keep this progress going,” she says. 

This discussion was released last week but I only had a chance to listen to it today and it's excellent.

Now, I would separate the discussion in two parts, how was UPP created, what is unique to this plan, where is their focus and how did they ramp up in the middle of Covid? 

The second part is on sustainability and its importance at UPP and how they are tackling this issue inside their organization and influencing peers to vote on certain proposals like asking Couche-Tard to set medium-term targets for material Scope 1 and 2 emissions reductions, in line with its peers, as well as setting out its approach to tackling Scope 3 emissions. 

Admittedly, Couche-Tard is the last company I think of when it comes to climate change is climate disclosure but if UPP proposed this proposal, they did their homework and feel strongly about it.

Also, I am a big believer in science-based climate proposals and more importantly, on striking the right balance between climate initiatives and future economic prosperity.

So, when Shift goes after UPP or other pension plans for investing in oil and gas or pipeline firms, it doesn't just rub me the wrong way, it makes my blood boil because in my humble opinion, we have dithered far too long listening to climate activists and need to reintroduce logic and sensible policies that will create jobs and create economic prosperity. 

"Keep it in the ground is just idiotic," it's a slogan which needs to be laid to rest once and for all.

Again, these are my opinions, I don't agree with every pension fund manager on all climate issues but I definitely listen to their views and Barb is an expert worth listening to. 

So, without rambling on here, please take the time to listen to her discussion with Chris Hall. 

Below, in this video, CEO Barbara Zvan explains how the University Pension Plan Ontario was designed to be green “from the get-go”, while maintaining a laser focus on value creation. Most pension plan CEOs have faced the challenge of integrating ESG factors into their investment plans and business models, but Zvan highlights how UPP leveraged its opportunity to build them into the foundations.

Steve Goldstein of MarketWatch reports the AI bubble is 17 times the size of the dot-com frenzy — and four times the subprime bubble, analyst says:

For good reason, it feels that the only major discussion in markets is whether AI is in a bubble or whether it’s actually the early innings of a revolutionary phrase.

So here’s another one, decidedly from the pessimistic camp. It’s a take from independent research firm the MacroStrategy Partnership, which advises 220 institutional clients, in a note written by analysts including Julien Garran, who previously led UBS’s commodities strategy team.

Let’s start with the boldest claim first — it’s that AI is not just in a bubble, but one 17 times the size of the dot-com bubble, and even four times bigger than the 2008 global real-estate bubble.

And to get that number, you have to go back to 19th-century Swedish economist Knut Wicksell. Wicksell’s insight was that capital was efficiently allocated when the cost of debt to the average corporate borrower was 2 percentage points above nominal GDP. Only now is that positive, after a decade of Fed quantitative easing pushed corporate bond spreads low.

Garran then calculates the Wicksellian deficit, which to be clear includes not only artificial-intelligence spending but also housing and office real estate, NFTs and venture capital. That’s how you get this chart on misallocation — a lot of variables, but think of it as the misallocated portion of gross domestic product fueled by artificially low interest rates.

But Garran also took aim at large language models themselves. For instance, he highlights one study showing that the task-completion rate at a software company ranged from 1.5% to 34%, and even for the tasks that were completed 34%, that level of completion could not be consistently reached. Another chart, previously circulated by Apollo economist Torsten Slok based on Commerce Department data, showed the AI adoption rate at big companies now on the decline. He also showed some of his real-world tests, like asking an image maker to create a chessboard one move before white wins, which it didn’t come close to achieving.

LLMs, he argues, already are at the scaling limits. “We don’t know exactly when LLMs might hit diminishing returns hard, because we don’t have a measure of the statistical complexity of language. To find out whether we have hit a wall we have to watch the LLM developers. If they release a model that cost 10x more, likely using 20x more compute than the previous one, and it’s not much better than what’s out there, then we’ve hit a wall,” he says.

And that’s what has happened: ChatGPT-3 cost $50 million, ChatGPT-4 cost $500 million and ChatGPT-5, costing $5 billion, was delayed and when released wasn’t noticeably better than the last version. It’s also easy for competitors to catch up.

“So, in summary; you can’t create an app with commercial value as it is either generic (games etc), which won’t sell, or it is regurgitated public domain (homework), or it is subject to copyright. It’s hard to advertise effectively, LLMs cost an exponentially larger amount to train each generation, with a rapidly diminishing gain in accuracy. There’s no moat on a model, so there’s little pricing power. And the people who use LLMs the most are using them to access compute that costs the developer more to provide than their monthly subscriptions,” he says.

His conclusion is very stark: not just that an economy already at stall speed will fall into recession as both the data-center and wealth effects plateau, but that they’ll reverse, just as they did in the dot-com bubble in 2001.

“The danger is not only that this pushes us into a zone 4 deflationary bust on our investment clock, but that it also makes it hard for the Fed and the Trump administration to stimulate the economy out of it. This means a much longer effort at reflation, a bit like what we saw in the early 1990s, after the S&L crisis, and likely special measures as well, as the Trump administration seeks to devalue the US$ in an effort to onshore jobs,” he says.

The firm’s investment recommendations are to be overweight resources and emerging markets — India and Vietnam in particular — and underweight the AI and platform companies. They also recommend being long gold equities (GDX), long short-dated U.S. Treasurys, long volatility (VIX) and long the yen vs. most currencies outside of the U.S. dollar. 

Robert Smith and Harriet Agnew of the Financial Times also reportJim Chanos slams ‘magical machine’ of private credit after First Brands collapse:

Jim Chanos, one of Wall Street’s best-known short sellers, has sounded the alarm on the private debt boom, telling the Financial Times that First Brands Group’s chaotic bankruptcy could augur a wave of corporate collapses.

Some of the biggest names on Wall Street are facing the prospect of multibillion-dollar losses from the bankruptcy of First Brands, a heavily indebted maker of spark plugs and windscreen wipers based in Ohio.

First Brands has now disclosed almost $12bn in debt and off-balance sheet financing built up in the years before its Sunday bankruptcy filing, which also ensnared less well-known private lenders such as a Utah-based leasing specialist.

“I suspect we’re going to see more of these things, like First Brands and others, when the cycle ultimately reverses,” Chanos told the Financial Times, “particularly as private credit has put another layer between the actual lenders and the borrowers.”

Chanos, 67, cemented his reputation shorting energy trader Enron, which like First Brands made substantial use of off-balance sheet financing and whose $70bn collapse heralded the onset of the 2001 stock market crash.

He announced in 2023 that he was closing his main hedge funds after more than three decades, while continuing to offer bespoke advice on fundamental short ideas as well as some macro insights.

In a 2020 Lunch with the FT interview, Chanos said financial markets were in “the golden age of fraud”. On Thursday he said this phenomenon had “done nothing but gallop even higher” since he made the remark.

First Brands has not been accused of fraud. However, a bankruptcy probe into its byzantine off-balance sheet financing is examining whether the company pledged the same invoices multiple times. This investigation has also uncovered that debt collateral may have been “commingled”.

The FT has previously reported that the group’s founder and owner, low-profile businessman Patrick James, was previously sued by two lenders that alleged that fraudulent conduct had exacerbated their losses.

James strongly denied the allegations of fraud in the two cases, which were both dismissed after settlements were reached.

First Brands and James did not respond to a request for comment.

Chanos likened the near $2tn private credit apparatus fuelling Wall Street’s lending boom to the packaging up of subprime mortgages that preceded the 2008 financial crisis, due to the “layers of people in between the source of the money and the use of the money”.

Privately owned First Brands’ eschewed the more public bond market in favour of borrowing money through so-called leveraged loans. It also raised billions of dollars through even more opaque financing backed by its invoices and inventory, which was often provided through private credit funds.

“With the advent of private credit . . . institutions [are] putting money into this magical machine that gives you equity rates of return for senior debt exposure,” he said, adding that these high yields for seemingly safe investments “should be the first red flag”.

The FT has previously reported that some private credit fund managers had estimated returns in excess of 50 per cent on First Brands’ supposedly secured inventory debt.

Even many of the most sophisticated credit specialists on Wall Street were until recently unaware of the existence of the US auto parts maker’s special purpose entities (SPEs) backing its inventory financing.

Traders at Goldman Sachs told clients hours before these financing vehicles separately filed for bankruptcy last week that they just had discovered indications of high-cost borrowing from these entities that were “hard to reconcile”.

Chanos said: “We rarely get to see how the sausage is made.”

First Brands’ bankruptcy has revealed that James controlled both the auto parts conglomerate and some of its off-balance sheet SPEs through the same chain of limited liability corporations. Chanos described this common ownership as a “huge red flag”.

His short thesis against Enron was fuelled in part by the realisation that executives at the group were managing SPEs that engaged in complex transactions outside the purview of its corporate balance sheet. In contrast to Enron, First Brands’ financial statements were not publicly available. While hundreds of managers of so-called collateralised loan obligations had access to its financial disclosure, they had to consent to non-disclosure agreements to receive the documents.

“The opaqueness is part of the process,” Chanos said. “That’s a feature not a bug.”

Sean Conlon and Pia Singh of CNBC also report it was another another solid week for the S&P 500 even if Friday's rally fizzled:

The S&P 500 retreated from a record on Friday but held on to solid weekly gains despite a U.S. government shutdown dragging on for a third day.

The broad market index closed little changed, ticking up just 0.01% at 6,715.79, while the Nasdaq Composite declined 0.28% to settle at 22,780.51. The Dow Jones Industrial Average outperformed, trading higher by 238.56 points, or 0.51%, to finish at 46,758.28. The Russell 2000 also popped 0.72% to close at 2,476.18. All four benchmarks had hit all-time highs earlier in the session.

Stocks were knocked down a bit in afternoon trading by declines in key technology names like Palantir Technologies, Tesla and Nvidia. Palantir led the S&P 500′s pullback, falling 7.5%, while Tesla and Nvidia dropped more than 1% and almost 1%, respectively. The CBOE Volatility Index spiked, signaling some investors were scrambling to buy some protection against a future S&P 500 decline in the form of put contracts.

Still, the three leading indexes saw a positive weekly finish. The broad market S&P 500 rose around 1.1% on the week, along with the 30-stock Dow, while the tech-heavy Nasdaq increased 1.3%. The small-cap Russell has jumped nearly 2% in the period.

Investors have been overlooking anxieties surrounding the government shutdown, which entered its third day Friday. While the stoppage has exacerbated underlying concerns this year about macroeconomic and policy headwinds, inflation risks and a slowing labor market, investors expect it to be short-lived, thereby limiting potential hits to the U.S. economy. Those on Wall Street also believe that the shutdown won’t stop the momentum in the artificial intelligence trade. Shutdowns have not been market-moving events in the past.

The shutdown has led to an economic data blackout, and the Labor Department’s pause on virtually all activity has blocked the Friday release of the September nonfarm payrolls report. Although that removes a factor that could lend pressure to stocks, it lessens the amount of economic data the Federal Reserve can take into account for its interest rate decision at its October meeting. Markets largely expect the central bank will lower its key interest rate by a quarter percentage point then, per the CME FedWatch tool.

Adding to ongoing concerns regarding the jobs market, President Donald Trump has threatened massive layoffs and said Thursday that the Democrats have given him an “unprecedented opportunity” to cut federal agencies. Treasury Secretary Scott Bessent also told CNBC Thursday that the current lapse in federal funding could lead to “a hit to the GDP, a hit to growth and a hit to working America.” The Congressional Budget Office estimates 750,000 federal workers will be furloughed each day.

Their remarks come a day after private payrolls posted their biggest decline since March 2023 in September, according to ADP. Wednesday’s report serves as yet another sign that the labor market is weakening, and some believe that the state of the labor market combined with the shutdown bolster the case for the Fed to cut.

“We view September’s mixed, private-sourced substitutes for the Labor Department’s delayed jobs report as soft enough to justify another interest-rate cut by the Federal Reserve at the October 29 FOMC meeting,” said Jennifer Timmerman, senior investment strategy analyst at Wells Fargo Investment Institute. “Prospects for further rate cutting by the Fed, reinforced by the yellow flag for the economy raised by the latest jobs data, has cemented a rally in stocks and left the yield on the benchmark 10-year Treasury note low enough, at 4.11%, to lift the S&P 500 to a fresh all-time high.” 

Alright, it was a big week on Wall Street but you have to dig below the surface to appreciate the speculative frenzy.

For example, shares of Rigetti Computing, D-Wave Quantum and Quantum Computing have surged more than 20%. Rigetti and D-Wave Quantum have more than doubled and tripled, respectively, since the start of the year. Arqit Quantum skyrocketed more than 32% this week.

The jump in shares followed a wave of positive news in the quantum space.

Keep in mind, most of these stocks are up over 3,000% during the last year and they keep being bid up. 

And it's not just quantum computing, everything speculative is rallying hard in these markets, look at the most active stocks on Friday, all these stocks had a monster week: 

In my opinion, this market only wants to go up, the shutdown is positive for Trump and markets and his administration will use it to its advantage.

But that's just the tip of the iceberg.

Importantly, FOMO is kicking into high gear as we head into year-end and most portfolio managers are drastically trailing their benchmark and looking to chase winners to make up for lost performance.

Having lived through many bubbles, I can tell you they typically go on for a lot longer than anyone can imagine.

And there's always more money chasing new bubbles so this one will likely last longer than the previous one, especially since the US dominates tech trading and that's where bubbles find a home.

But it's also fair to say this rally is broader and not just AI led.

US banks are on fire this year, healthcare stocks led by Humana (HUM) and Pfizer (PFE) had a terrific week, as did gene editing stocks like Taysha Gene Editing (TSHA) and Crisper (CRSP). Hell, First Solar (FSLR) is on fire after dipping hard earlier this year:

 

I can show you a lot of great stocks that look the same and it's not just AI related, which makes you wonder why are so many portfolio managers underperforming the S&P 500??

In closing, we all know the AI bubble is alive and kicking, that OpenAI isn't really worth half a trillion dollars but Wall Street wants us all to believe this is it, this is the next Big Thing. 

Enjoy the ride while it lasts, nobody ever rings the bell at the top or bottom, usually something breaks sending markets tumbling down hard.  

All I can tell you is to watch stocks closely here, speculative manias feed on themselves, it can last a lot longer than you think, never mind what smart strategists think or write, it's irrelevant.

Below, CNBC’s “The Exchange” team discusses whether there is a brewing market bubble in artificial intelligence stocks and how they’re thinking about the AI trade.

Also, Lo Toney, Plexo Capital founder and managing partner, joins 'Closing Bell' to discuss Jeff Bezos' recent comments on AI, how to distinguish between the good and bad ideas and much more.

Lastly, Marc Lasry, Avenue Capital Group chairman, CEO and co-founder, joins 'Closing Bell' to discuss if auto company bankruptcies are the tip of the spear, potential effects of the explosive growth around private credit and much more.