CPPIB Nets Highest Fiscal Year Gain with 20.4%

The Canada Pension Plan Investment Board (CPPIB) netted a whopping 20.4% gain in its most recent fiscal year, thanks to outperformance in energy and resources, and Canadian public equities. It was the fund’s highest return since its inception.

The Toronto-based pension system ended the 2021 fiscal year with C$497.2 billion (US$413.2 billion) in assets, as of March 31, CPPIB disclosed Thursday. That’s up from $409.6 billion the prior year, in fiscal year 2020, when the pension fund returned just 3.1%.

Additionally, the pension fund boasted an 11% five-year return and a 10.8% 10-year return, on an annualized basis.

The fund performed “exceptionally well” across all six asset categories, according to CPPIB President and Chief Executive Officer John Graham. Global equity markets in both emerging and developed markets rebounded from the market downturn last year.

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“The fiscal year was bookended by extremes, with markets reaching new record highs following the significant lows just 12 months earlier,” Graham said. “Our discipline ensures we keep the fund on track, demonstrating resilience in a crisis and strong growth on the upside.”

The best performing asset classes at the pension fund include energy and resources, which returned 45.8%, Canadian public equities, which rose 40.8%, and emerging private equities, which gained 38.5%.

“Diversification, prudent risk-taking in investment selection, and high-caliber global teams propelled the fund as we near the half-trillion-dollar milestone about seven years before it was projected at inception,” Graham added.

Still, at least some of CPPIB’s gains were held back by foreign exchange losses. With the Canadian currency gaining on the US dollar, the fund lost $35.5 billion during the fiscal year.

The pension fund has undergone other changes in the past fiscal year. In February, it appointed Graham as president and CEO, replacing Mark Machin, who stepped down after traveling to the Middle East for the coronavirus vaccine.