Climate change

We support the goal of the Paris Agreement to limit global temperature increase in this century to well below 2 degrees Celsius relative to pre-industrial levels and to pursue efforts to limit temperature increase to 1.5 degrees Celsius. To help achieve this future, we've set the following goals and targets:  

• Net-zero greenhouse gas (GHG) emissions by 2050 in our operations and investments. 
• An interim target of a 50% absolute reduction of GHG emissions in our operations by 2030, relative to 2019.   

Interim targets have been established or are under development for our asset management businesses and for Sun Life’s general account. Refer to our Net Zero by 2050 report for the latest updates on those targets and Sun Life’s progress towards net zero. 

Sun Life’s asset management companies are also contributing to net-zero efforts through participation in the Net Zero Asset Managers initiative (NZAM). These companies include: MFS Investment Management (MFS), SLGI Asset Management Inc. (SLGI), SLC Fixed Income, BGO and InfraRed Capital Partners (InfraRed). Part of the commitment as a NZAM signatory includes setting interim targets for the proportion of assets to be managed in line with net zero by 2050. Learn more in Sustainable Investing. 

We’re developing an enterprise climate transition plan (CTP) that will act as the roadmap to 2050. This roadmap will lay out the pathways by which the organization will meet its interim and long-term net-zero goals. The plan will integrate climate risk management, strategy and governance considerations and will be informed by high-quality data. We intend to be part of the solution by investing in new technology and working with Clients, investees and industry partners to generate the data needed for identifying the levers to achieve decarbonization. 

In support of our CTP, we're working to advance our measurement of our scope 3 emissions. These are emissions that are incurred upstream and downstream in our value chain as a result of our business activities. They include emissions associated with air travel, the offices our employees occupy and the activities of the companies in which we invest. To date we have made strides in measuring our carbon footprint despite challenges in collecting scope 3 emissions data. Looking ahead, we'll continue to enhance our abilities to measure these emissions as comprehensive data is foundational to our ability to build and deliver on our CTP. 

Since 2021, we've maintained CarbonNeutral®⁴ company certification across our global operations. Our carbon neutrality commitment involves purchasing high-quality carbon credits to offset the GHG emissions we haven’t yet reduced or eliminated. While we maintain carbon neutrality, we're also working to achieve real emissions reductions in our operations. Efforts include reducing our total energy consumption (a primary source of our operational emissions) by investing in energy-efficiency initiatives in our offices and continuing to increase our use of renewable energy sources. Carbon offsetting is not part of our long-term decarbonization strategy, but an interim measure to help reduce Sun Life’s impact in pursuit of net zero.

We’re working to understand and address potential climate change risks across Sun Life. For example, we've been gaining experience with climate change scenario analysis and stress testing, and continue to explore climate modeling for regulatory compliance and disclosure. We assess the potential effects of various climate change-related impacts on our office locations and investment properties. These include storms and flash floods that we expect to become more frequent and intense. Each year, we update our business continuity plans to ensure key business functions and normal operations can resume effectively and efficiently should a major disruption occur (including, but not limited to, an extreme weather event). 

We review environmental risks within Sun Life’s Risk Management Framework (RMF). Our RMF outlines our risk management process for how we identify, measure, manage, monitor and report current and emerging risks. As we mature on our climate journey, we're refining our inclusion of climate risk in the RMF and sharpening its integration across our risk policies. Learn more in Risk Management and in our Annual Report.   

As a long-term investor, we're also working to address the climate emergency. We invest proactively in assets and businesses that support the transition to a low-carbon economy. Examples include renewable energy, energy efficiency, sustainable buildings and clean transportation. In our asset management businesses, we consider environmental, social and governance (ESG) risks as part of our investment decision-making process, where material. ESG risks include the physical and transition risks that climate change poses. Read more about our Sustainable Investing approach.

We’re adapting our facilities, portfolios and leasing strategies to a changing climate through enhanced risk management and building and infrastructure retrofits. Proactively, we examine ways to build climate resilience and human wellness features into our real estate portfolios. 

• To support the achievement of our operational GHG target (refer to the “Goals” section below), we've developed a forecast model of our corporate real estate locations in North America. The model includes portfolio strategy initiatives for right-sizing of space (lease end dates, options to release space, prospective off-site renewable energy investment opportunities, and more) for a quick snapshot of current and future projected GHG emissions.
• During the acquisition process for select BGO-managed Sun Life assets, BGO identifies climate-related issues like flooding, extreme precipitation, hurricane-force winds, sea level rise, water and heat stress, and earthquakes.

Strong governance and clear lines of accountability help us deliver on our environmental commitments and remain accountable to our stakeholders. We maintain robust oversight of our Sustainability Plan and performance through a governance structure that includes the Board of Directors, Sun Life’s Global Leadership Team and senior executives from each of our business groups and key functions.

• The Board has ultimate oversight of sustainability and the enterprise approach to climate change. The Governance, Investment & Sustainability Committee of the Board (GISC) assists the Board with oversight of sustainability matters, including those related to climate. The Risk Committee of the Board assists the Board with enterprise-wide oversight of the management of current and emerging risks (which may include climate-related risks and broadly, environmental risks). The Audit Committee reviews ESG disclosures (including climate-related disclosures) required to be included in the financial disclosure documents.
• The Executive Sustainability and Climate Change Council (ESC) is the decision-making body for the approval of cross-enterprise sustainability programs and issues management (e.g., human rights), as well as external commitments and targets including related progress oversight. The ESC is comprised of senior executives of Sun Life’s Global Leadership Team and is chaired by our Chief Sustainability Officer (CSO).
• The Global Sustainability Leadership Team (GSLT) advises and drives execution towards our sustainability objectives. The GSLT is comprised of senior executives from each of our business groups and key functions.
• Our CSO is accountable to ensure the company meets its sustainability commitments and advocates for strong government policies and regulations that support a low-carbon, more inclusive economy. These efforts are supported by the sustainability team. 
• Our Vice-President (VP) of Climate Change and Environmental Impact oversees the development and implementation of the enterprise-wide climate change strategy, climate risk, and decarbonization performance and reporting functions. The VP oversees a corporate-level team of climate experts covering performance, risk management strategy and program management.

We reward performance on goals related to our GHG emissions reduction targets and other environmental achievements.  

Employees play an important role in our journey towards net zero. We engage employees on environmental matters through virtual training and tailored content on internal social engagement platforms, empowering them to take more sustainable actions. We encourage this behaviour whether they’re in the workplace or working from home.

We closely monitor our environmental programs to track progress against our targets. We commit to transparent reporting and strengthening our climate disclosures:  

• We report on several key performance indicators, including sustainable investments and GHG emissions, annually in our Sustainability Report.  
• Our annual GHG emissions data has undergone limited assurance since 2020. We've disclosed GHG emissions to CDP since 2010.  
• In our Annual Report, we provide climate-related disclosures guided by the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) framework. We support the actions of regulators, including the Office of Superintendent of Financial Institutions and Canadian Securities Administrators, to align their reporting requirements to the International Sustainability Standards Board’s IFRS S1 and S2, and welcome ongoing efforts to improve disclosure standards.
• BGO and Sun Life Global Solutions India are ISO 14001-certified for their Environmental Management Systems (EMS). The EMS covers the collection, monitoring, record keeping, evaluation and reporting of environmental and sustainability data. In doing so, it ensures the successful implementation of environmental programs and continuous improvement.

Climate change is a shared, societal challenge. We're committed to collaborating with governments, regulators, investors and industry leaders to develop net-zero programs and policies that align decarbonization efforts and goals, and bolster the resilience of our business from the impacts of climate change. We’ve engaged with policymakers and regulators advocating for economy-wide climate-related financial disclosures, greater consideration of the life and health impacts from climate change, and opportunities to build more climate-resilient infrastructure. 

You’ll find highlights of our public policy activities throughout our Sustainability Report.