A Shell employee walks past the company’s new Quest Carbon Capture and Storage (CCS) facility in Fort Saskatchewan, Alta., on Oct. 7, 2021. As many as 800,000 Canadian jobs are dependent on sectors vulnerable to disruption in a low-carbon transition.
TODD KOROL/Reuters
Hundreds of thousands of jobs could be at risk if Canada fails to attract sufficient private capital to transform its industries for life in a low-carbon global economy, a study by a federally supported climate think tank says.
As many as 800,000 jobs are dependent on sectors vulnerable to disruption in such a transition, including oil and gas, mining, heavy industry and auto manufacturing, according to the Canadian Institute for Climate Choices.
Those industries account for almost 70 per cent of Canada’s exports and generated more than $300-billion in export revenue and investment in 2019.
Effective policy and regulations, targeted public spending and corporate disclosure of climate risks will be key to attracting private capital and keeping the country competitive in the coming decades, the institute said.
“Canada is at a pivotal moment, when global markets are changing and governments and businesses face a choice of whether to take action to transform the economy to succeed in new market realities or watch our competitive position in the world erode,” said Rachel Samson, the organization’s clean growth research director and lead author of the report.
It is being released a little more than a week before a UN conference in Glasgow to discuss strengthening national commitments to reduce emissions. The financial sector will play a major role in the talks.
Governments and businesses will have to invest as much as $2-trillion to retool Canada’s economy to get emissions to net zero by 2050, according to a report by RBC Economics released Wednesday. The money will be required for a range of things, including modernizing and greening the power grid to allow the mass adoption of electric vehicles and retrofitting buildings to make them energy-efficient.
Ms. Samson said it would be wrong to consider the required spending as costs that would just disappear into the financial system; instead, it is an investment in cleaner economic growth. “So, in terms of thinking about the price tag, I think we have to think about the overall impact on the well-being of Canadians,” she said.
The researchers designed the study, called “Sink or Swim,” as a stress test for the economy as climate considerations take on a greater role and investors seek assets they deem sustainable. This is where competitiveness is key, they said.
Investors around the world will redirect trillions of dollars away from high-carbon sectors as countries try to meet net-zero targets. That will shift trade patterns, transform demand and put businesses that are slow to adapt in jeopardy, the study said.
Every Canadian province and territory has workers in sectors that are vulnerable to disruption in the transition to clean energy, the study said. Alberta, with its large oil and gas and energy service sectors, has the highest proportion of such workers, at 9.1 per cent of the work force, followed by the Northwest Territories at 7 per cent, Saskatchewan at 6 per cent and Newfoundland and Labrador at 5.8 per cent.
The institute argues that climate strategies have to encompass more than reducing greenhouse gas emissions. A coal mine with low emissions, for example, will still face financial issues as power generators and steelmakers move away from coal-fired facilities in response to pressure from their own governments or investors. One solution for such a business would be to switch to the minerals required for renewable energy sources or EV batteries, it said.
The report said establishing ambitious national climate targets would mean a far smaller hit to gross domestic product by 2050 than acting slowly or maintaining the status quo. With aggressive action, the economy would experience a small increase to GDP from the transition by 2050 and a loss of about 2 per cent from physical climate risk, whereas maintaining the status quo would cut GDP by almost 5 per cent and provide no uplift from the transition, it said.
Ms. Samson said mustering the political will to set policies for getting to net zero is less of a stumbling block than it was in previous years.
“It’s not only about political will anymore. Markets are developing momentum of their own,” she said. “Investors are now actively seeking ways to reduce their carbon-related risks, and unions as well have shifted toward advocating for companies to take greater action to improve their transition readiness. They see it as the way to have a future that has secure jobs.”
Jeffrey Jones writes about sustainable finance and the ESG sector for The Globe and Mail. E-mail him at jeffjones@globeandmail.com.
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TOKYO (AP) — Japanese technology group SoftBank swung back to profitability in the July-September quarter, boosted by positive results in its Vision Fund investments.
Tokyo-based SoftBank Group Corp. reported Tuesday a fiscal second quarter profit of nearly 1.18 trillion yen ($7.7 billion), compared with a 931 billion yen loss in the year-earlier period.
Quarterly sales edged up about 6% to nearly 1.77 trillion yen ($11.5 billion).
SoftBank credited income from royalties and licensing related to its holdings in Arm, a computer chip-designing company, whose business spans smartphones, data centers, networking equipment, automotive, consumer electronic devices, and AI applications.
The results were also helped by the absence of losses related to SoftBank’s investment in office-space sharing venture WeWork, which hit the previous fiscal year.
WeWork, which filed for Chapter 11 bankruptcy protection in 2023, emerged from Chapter 11 in June.
SoftBank has benefitted in recent months from rising share prices in some investment, such as U.S.-based e-commerce company Coupang, Chinese mobility provider DiDi Global and Bytedance, the Chinese developer of TikTok.
SoftBank’s financial results tend to swing wildly, partly because of its sprawling investment portfolio that includes search engine Yahoo, Chinese retailer Alibaba, and artificial intelligence company Nvidia.
SoftBank makes investments in a variety of companies that it groups together in a series of Vision Funds.
The company’s founder, Masayoshi Son, is a pioneer in technology investment in Japan. SoftBank Group does not give earnings forecasts.
Shopify Inc. executives brushed off concerns that incoming U.S. President Donald Trump will be a major detriment to many of the company’s merchants.
“There’s nothing in what we’ve heard from Trump, nor would there have been anything from (Democratic candidate) Kamala (Harris), which we think impacts the overall state of new business formation and entrepreneurship,” Shopify’s chief financial officer Jeff Hoffmeister told analysts on a call Tuesday.
“We still feel really good about all the merchants out there, all the entrepreneurs that want to start new businesses and that’s obviously not going to change with the administration.”
Hoffmeister’s comments come a week after Trump, a Republican businessman, trounced Harris in an election that will soon return him to the Oval Office.
On the campaign trail, he threatened to impose tariffs of 60 per cent on imports from China and roughly 10 per cent to 20 per cent on goods from all other countries.
If the president-elect makes good on the promise, many worry the cost of operating will soar for companies, including customers of Shopify, which sells e-commerce software to small businesses but also brands as big as Kylie Cosmetics and Victoria’s Secret.
These merchants may feel they have no choice but to pass on the increases to customers, perhaps sparking more inflation.
If Trump’s tariffs do come to fruition, Shopify’s president Harley Finkelstein pointed out China is “not a huge area” for Shopify.
However, “we can’t anticipate what every presidential administration is going to do,” he cautioned.
He likened the uncertainty facing the business community to the COVID-19 pandemic where Shopify had to help companies migrate online.
“Our job is no matter what comes the way of our merchants, we provide them with tools and service and support for them to navigate it really well,” he said.
Finkelstein was questioned about the forthcoming U.S. leadership change on a call meant to delve into Shopify’s latest earnings, which sent shares soaring 27 per cent to $158.63 shortly after Tuesday’s market open.
The Ottawa-based company, which keeps its books in U.S. dollars, reported US$828 million in net income for its third quarter, up from US$718 million in the same quarter last year, as its revenue rose 26 per cent.
Revenue for the period ended Sept. 30 totalled US$2.16 billion, up from US$1.71 billion a year earlier.
Subscription solutions revenue reached US$610 million, up from US$486 million in the same quarter last year.
Merchant solutions revenue amounted to US$1.55 billion, up from US$1.23 billion.
Shopify’s net income excluding the impact of equity investments totalled US$344 million for the quarter, up from US$173 million in the same quarter last year.
Daniel Chan, a TD Cowen analyst, said the results show Shopify has a leadership position in the e-commerce world and “a continued ability to gain market share.”
In its outlook for its fourth quarter of 2024, the company said it expects revenue to grow at a mid-to-high-twenties percentage rate on a year-over-year basis.
“Q4 guidance suggests Shopify will finish the year strong, with better-than-expected revenue growth and operating margin,” Chan pointed out in a note to investors.
This report by The Canadian Press was first published Nov. 12, 2024.
TORONTO – RioCan Real Estate Investment Trust says it has cut almost 10 per cent of its staff as it deals with a slowdown in the condo market and overall pushes for greater efficiency.
The company says the cuts, which amount to around 60 employees based on its last annual filing, will mean about $9 million in restructuring charges and should translate to about $8 million in annualized cash savings.
The job cuts come as RioCan and others scale back condo development plans as the market softens, but chief executive Jonathan Gitlin says the reductions were from a companywide efficiency effort.
RioCan says it doesn’t plan to start any new construction of mixed-use properties this year and well into 2025 as it adjusts to the shifting market demand.
The company reported a net income of $96.9 million in the third quarter, up from a loss of $73.5 million last year, as it saw a $159 million boost from a favourable change in the fair value of investment properties.
RioCan reported what it says is a record-breaking 97.8 per cent occupancy rate in the quarter including retail committed occupancy of 98.6 per cent.
This report by The Canadian Press was first published Nov. 12, 2024.
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