Caisse de dépôt et placement du Québec

History

Creation and early years (1965–1979)

The CDPQ was established by an act of the National Assembly on July 15, 1965, under the government of Jean Lesage, as part of the Quiet Revolution, a period of social and political change in Quebec. Its initial role was to manage the funds of the newly created Quebec Pension Plan, a public pension plan that aimed to provide financial security for Quebecers in retirement. The CDPQ's mandate was to invest the funds prudently and profitably while also contributing to Quebec's economic development.

In its early years, the CDPQ focused on building a bond portfolio that included predominantly Quebec government and Hydro-Québec securities. It made its first equity investment in Alcan Aluminium in 1967 and its first commercial mortgage loans in the same year. In 1971, it created the private investments portfolio, which included investments in Quebec companies.

Diversification and expansion (1980–1999)

In the 1980s, the CDPQ entered into international markets and the real estate sector. It made its first transactions in global equities exchanges in 1983 and its first international private equity investment in Compagnie financière Martin Maurel, in France, in 1984. It also acquired its first office building, Place Delta in Sainte-Foy, in 1980, and its first international real estate acquisition, Centre de conférence Albert-Borschette in Brussels, in 1993.

In the 1990s, the CDPQ diversified its real estate portfolio and increased its equity allocation. It acquired the real estate assets of the Steinberg grocery chain in 1989 and merged its real estate subsidiary, Ivanhoé, with Cambridge Shopping Centres in 2001, creating Ivanhoé Cambridge. It also obtained a legislative change in 1997 that increased its allowable equity allocation from 40% to 70% of its assets. It also moved into infrastructure investment in 1999, with the construction of Highway 407 in Toronto.

Crisis and recovery (2000–2009)

In the 2000s, the CDPQ faced the worst financial crisis since the stock market crash of 1929, which resulted in a loss of $42.5 billion in 2008. Following the crisis, the CDPQ adopted a series of measures to increase its effectiveness, refocus on its core competencies, and strengthen its risk management in order to better sustain long-term yields. It also launched a major plan to support Quebec businesses in 2009. It adopted a responsible investing policy in 2004 and signed the UN's Principles for Responsible Investment in 2006. In 2009, Otéra Capital, a subsidiary of the CDPQ, was created to act as a leader in commercial real estate debt across North America. Otéra Capital offers innovative financing solutions for various real estate sectors, such as office, retail, industrial, multifamily, hospitality, and seniors' housing.

Growth and innovation (2010–present)

In the 2010s, the CDPQ accelerated its pace of growth and expansion in Canada and abroad. In 2013 it created the Global Quality Equity Portfolio, which followed a new investment philosophy that favoured total returns, in-depth research, and investments in high-quality assets, anchored in the real economy. It combined all its real estate subsidiaries under one banner, Ivanhoé Cambridge, in 2011. It also established offices in several countries, such as the United States, Mexico, Brazil, France, India, China, Singapore, and Australia. In 2015, CDPQ Infra, a subsidiary of the CDPQ, was created to act as a principal contractor for public infrastructure projects. CDPQ Infra is responsible for all phases of a project: planning, financing, execution and operation.

In a September 28, 2021, press release, the CDPQ announced its 2021 climate strategy, which included divesting the remaining $3.9 billion currently held in oil company assets, which represented 1% of its investment portfolio, by 2022. According to the statement, the CDPQ was responding "to the markets, to science, and to the will of Quebecers who do not want their money to fuel the climate crisis."

As of June 30, 2023, the CDPQ managed assets of C$424 billion, invested in sectors such as private equity, fixed income, real estate, infrastructure, and renewable energy in Canada and elsewhere. It also supported Quebec-based companies with growth potential and contributed to the creation of jobs and wealth in the province. It strived to generate positive impacts for society and the environment. In 2022, Global SWF, a publication that covers sovereign wealth funds and other long-term public investors, awarded the CDPQ its 2022 Fund of the Year award. The next year, Infrastructure Investor magazine, which focuses on the global infrastructure investment market, ranked the CDPQ the top institutional investor in infrastructure based on asset size in the Global Investor 50 list.

Terra Carta Seal (2023) - Sustainable Markets Initiative

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Subsidiaries

The CDPQ has three subsidiaries: Ivanhoé Cambridge, Otéra Capital, and CDPQ Infra. The subsidiaries' headquarters are located in the Jacques-Parizeau building in Montreal.

Ivanhoé Cambridge

Ivanhoé Cambridge is the real estate subsidiary of the CDPQ. It aims to invest in real estate assets including office space, shopping centres, and multi-residential buildings. Some of its biggest projects include CIBC Square in Toronto and Tours Duo in Paris.

Otéra Capital

Otéra Capital, another subsidiary of the CDPQ, provides commercial real estate debt financing across North America. It has a portfolio of over C$29 billion in loans as of December 31, 2022. It offers various financing options for different real estate sectors, including office, industrial, retail, multi-family, hospitality, and seniors' housing. Otéra Capital also has a strong commitment to environmental, social, and governance (ESG) principles and has recently granted its first green loan to a sustainable office building project in Toronto. Its headquarters are located in Montreal, and it has offices in Toronto, Vancouver, New York, and Los Angeles.

Controversy over private security investments

The CDPQ has been criticized for investing in the private security industry. It became the main shareholder of Allied Universal and also invested in CAE Inc. Critics have derided the poor economic value of these choices. and the social and ethical problems that surround the industry. The holding of Allied Universal by the CDPQ became more of a problem after the company acquired G4S, a firm that has been implicated in many controversies that led most public pension funds to divest from it. G4S holds parts of Policity Corporation, a company that operate Israel's National Police Academy. The global ESG rating of G4S in 2019 was C−.