The change to a more sustainable economic model will create substantial new investment opportunities. Canadian market participants are attracted to a wide range of them.
We asked respondents about 17 innovations and parts of the economy, asking them to rank those they thought would offer the largest and most attractive scope for investment in Canada in the next five years. Every opportunity picked as first choice by a voter received 17 points, each one ranked second got 16 points, and so on. The scores were then averaged to produce a blended figure that represents both the breadth and intensity of market participants’ enthusiasm for each kind of investment.
“Canadian issuers show a notable enthusiasm for solar power: it is by far their most popular choice”
Infrastructure stood out as the most favoured, with energy-efficient commercial and public buildings receiving the highest score, followed by sustainable public transport.
This preference for infrastructure investment echoes our 2020 global survey. There, Canadian issuers favoured improved electricity storage as their top investment priority for the country, while Canadian investors identified electrifying the transport system.
In this Canada survey, Canadian issuers show a notable enthusiasm for solar power: it is by far their most popular choice. Their interest in other renewable energy sources, such as wind, and hydrogen power, is very limited. Wave and tidal power received no support at all.
Investors have very different views. They see solar less favourably than all other renewables, but are excited about hydrogen — it is their top pick among all 17.
Similarly, the fourth strongest pick overall — more sustainable plastics and alternatives to them — drew far stronger support from issuers than investors.
Conversely, while investors are quite enthusiastic about modular nuclear reactors, issuers are highly sceptical about this energy source. They also are far less persuaded than investors of the size and scope of the opportunity in recycling and the circular economy. These disparities underscore the different perspectives the two groups bring to investment opportunities, as providers of capital and long term operators.
In a separate question, we asked issuers and investors whether they felt these sustainable opportunities were relevant to them and whether they felt able to invest. In both groups, between 50% and 60% said the opportunities were relevant and they would be able to put money into them. But far more investors, 26%, felt they could do so immediately.
Only 5% of issuers believe they could invest immediately, though 54% think they will be able to invest in future. Nearly all the rest of both groups are either unsure or believe sustainable investment opportunities are not relevant now, but will be in future. Only 1% of investors and 4% of issuers are convinced they never will be.