Canadian Pacific Railway CP
TCI, owner of ~8% of Canadian Pacific, demands the railroad close its CDP climate-disclosure gap versus peers CN and UNP and adopt a credible science-based transition plan.
Thesis
TCI Fund Management, which owns around 8% of Canadian Pacific Railway, writes to CEO Keith Creel arguing that CP's climate disclosure and decarbonisation agenda materially lag peers and threaten long-term returns. In 2018 CP earned only an overall C grade from CDP, while Canadian National scored A and Union Pacific A-, and CP has no science-based GHG target, limited Scope 3 coverage, no management incentive linkage, and only nascent scenario analysis. TCI asks CP to publish a credible Paris-aligned transition plan anchored in SBTI methodology, tie executive compensation to emissions targets, fully disclose Scope 3 via CDP's Supply Chain Initiative, and accelerate advanced biofuel, battery-electric and hydrogen locomotive R&D. TCI signals it will vote against directors and auditors at companies that fail to disclose emissions or produce credible reduction plans.
SCQA
Canadian Pacific is a Class I railroad where 94% of direct emissions come from rail operations, operating in a sector with a 4x fuel-efficiency advantage over trucking but rising climate-regulation exposure.
CP's 2018 CDP climate score is an overall C — versus CN at A and Union Pacific at A- — with no science-based target, thin Scope 3 coverage, no compensation linkage, and only nascent scenario analysis.
Adopt a credible SBTI/Paris-aligned transition plan, disclose fully to CDP, expand Scope 3 and supply-chain engagement, tie executive pay to emissions targets, and accelerate biofuel, battery and hydrogen locomotive R&D.
Achieving A-grade disclosure reinforces CP's competitive advantage over trucking, protects against carbon-regulation, financing and litigation risk, and supports long-term profitability, sustainability and investor returns.
The three reasons
- 1
CP's CDP C grade lags peers CN (A) and Union Pacific (A-), an unacceptable gap
- 2
94% of CP's direct emissions come from rail ops, making fuel/fleet decarbonisation urgent and tractable
- 3
Rail is 4x more fuel-efficient than trucking — CP can defend and expand modal share via ESG leadership
Primary demands
- Make full annual public disclosure of GHG emissions to CDP
- Publish a credible low-carbon transition plan with science-based targets aligned with the Paris Agreement
- Adopt SBTI-based climate scenario analysis similar to Canadian National's 29% intensity reduction by 2030 target
- Tie a meaningful percentage of senior management and staff incentive compensation to emissions targets
- Expand Scope 3 emissions analysis to cover purchased and capital goods, fuel/energy, and use of products sold
- Engage value chain via CDP's Supply Chain Initiative
- Accelerate R&D into advanced biofuels, battery- and hydrogen-powered locomotives
- Achieve an A grade in CDP Climate Change Program (currently C, peers at A/A-)
KPIs cited
Pattern membership
Where this document fits across the library's 12 rhetorical / structural patterns.
Precedents cited
- Canadian National 29% GHG intensity reduction by 2030 (SBTI)
- Wabtec-GE lithium-ion battery locomotive consist
- Alstom Coradia iLint hydrogen fuel cell train (Germany)
- HydroFLEX hydrogen rail pilot (UK)
Notable slides (3)
Notes
TCI climate-engagement letter to CP CEO Keith Creel, signed by Chris Hohn, Philip Green and Ben Walker. ESG-governance rather than classic financial activism: primary demand is closing the CDP disclosure gap vs. peers CN (A) and UNP (A-), adopting SBTI-aligned transition plan, and linking executive pay to emissions targets. Stake explicitly disclosed at ~8%. Includes a one-page appendix on how to reach CDP A grade. Threat lever is stated voting policy (against directors/auditors) and possible divestment, not a proxy fight. Tone is collaborative-but-firm; no target price, no valuation framework, no sum-of-parts. Classified as initial_thesis for ESG engagement campaign (distinct from Pershing-era CP campaign).