FinanceMap scores this financial institution in the following areas. Please navigate to the relevant tab for in-depth analysis
FinanceMap assesses these portfolios for this financial institution. Please navigate to the relevant tab for in-depth analysis.
Toronto-Dominion (TD) Bank Group's board directly oversees climate-related goals and targets as well as progress against these objectives. Management level positions and committees are assigned various climate-related responsibilities, and has some description of how senior management is involved in the management of climate strategy. For example, TD has formalized a governance structure to provide oversight and accountability over the development of financed emissions targets.
TD has referenced in detail the climate-related risks and opportunities it considers relevant to its business, but does not disclose which risks and opportunities it considers over short, medium and long time horizons. The organization uses a Climate Credit Risk Dashboard to monitor and assess climate-related risks and quantify impacts on different portfolios, and appears to consider climate-related risks and opportunities on lending, advisory, and investment activities. Additionally, TD has provided several examples of how it has factored climate-related risk into relevant products and services across its business.
TD uses climate scenario analysis to assess the resilience of its business, including a physical risk scenario on its real estate portfolios in 2022. It has also participated in various initiatives to support its climate scenario analysis, including participating in a UNEP FI working group, Bank of Canada and OSFI Climate Change Pilot, and a pilot study with Moody's Analytics in 2021. However, it does not appear to use a robust range of climate scenarios, and does not describe how it plans to respond to the impacts identified in the analyses.
The organization outlines processes in place to identify and assess climate-related risks in its TCFD reporting. For example, in 2022 TD expanded the scope of its heatmap analysis, which it uses to identify and assess the relative significance of climate-related risks. TD details how it mitigates various types of climate risks, such as an E&S Risk Process that involves enhanced due diligence and escalations, a Climate Target Operating Model to execute climate actions, and stress testing frameworks. The organization appears to have integrated climate-related risks into its overall risk management approach. For example, in 2022, TD approved an enterprise wide environmental and social risk policy for all business and corporate functions.
TD discloses some key metrics used to measure and manage climate-related risks and opportunities including exposure to carbon-related assets, internal carbon pricing, outstanding loans to sectors exposed to climate risk, and remuneration policies.
The organization is transparent regarding Scope 1, Scope 2, and relevant Scope 3 emissions data. In 2022 it increased the number of carbon intensive sectors it measures and reports its financed emissions from two to seven, disclosing financed emissions for energy, power and utilities, automotive, shipping, aviation, agriculture, and industrials.
In November 2020, TD announced a target to achieve Net-Zero by 2050 for operations and financing activities and in October 2021 it joined the Net Zero Banking Alliance. In March 2022, TD released its 2030 interim targets for its lending to the energy and power sectors. For the energy sector, it used the financed emissions lending intensity metric to calculate its baseline and target, which it has committed to reduce by 29%. Meanwhile, it has committed to reduce the physical emissions intensity of the power sector by 58%. In 2022, TD announced two additional sector targets for automotive manufacturing and aviation portfolios, both based on the IEA Net Zero scenario but both using an emissions intensity metric.
TD’s coal policy states that it will restrict new mining company clients that: derive ≥ 30% of its revenue from the production of thermal coal; new power generation clients that generate ≥ 30% of its power (MWh) from unabated coal-fired power generation; any new mining company client that publicly states its intention to expand its thermal coal mining operations; or new power generation client that publicly states its intention to expand its unabated coal-fired power operations. However, it has not set clear restrictions on existing clients, and has not outlined a coal phase out in line with IPCC guidance.
With regards to natural gas and oil, TD has set exclusionary policies that prohibit financing to new oil and gas exploration, development, or production in the Arctic Circle. However, TD has not outlined other activities related to oil and gas in its Environmental and Social Risk Process and thus appears to be actively financing new or expansionary projects.
TD is increasing its financing of renewables, using a methodology to determine what activities are eligible for its $500 billion sustainable finance target. This methodology also includes nuclear energy as part of its eligible decarbonization activities, and outlines that the organization will mobilize finance for nuclear energy facilities, services, systems, and equipment.
FinanceMap’s Climate Governance and Policies analysis assesses statements financial institutions (FIs) are making on how they are incorporating climate issues into their decision-making and operations using FinanceMap’s matrix methodology. This methodology is adapted from the Task Force on Climate-Related Financial Disclosures (TCFD) recommendations and guidelines, Net-Zero Banking Alliance (NZBA) or equivalent Glasgow Financial Alliance for Net-Zero (GFANZ) initiative reporting, and IPCC and IEA technology statements. The TCFD provide guidance on 11 recommendations across four areas which are reflected in our matrix: Governance, Strategy, Risk Management, and Metrics and Targets. Additional benchmarks have been introduced to strengthen the ambition of scoring criteria in the assessment of targets, which are supplemented by guidance from the NZBA or equivalent GFANZ initiatives.
Additionally, Science-Based Policy (SBP) benchmarks are used to measure alignment of an FIs technology positions with the science of climate change. These benchmarks are applied to an FIs internal policies on technologies including coal, oil, gas, nuclear, and renewables and also assesses its engagement with broader climate and energy policy issues such as advocacy on the role and importance of different strategy types in the future energy mix.
For each TCFD recommendation and technology, FIs statements are applied to a five point scoring scale ranging from +2 to -2, measuring alignment with the relevant benchmarks. The detailed scores for this FI are displayed below within each matrix cell.
The following table outlines the key queries and data sources, which FinanceMap uses to assess financial institutions climate governance, targets and policies. Every evidence piece is assessed on a five-point scale of -2,-1,0,1,2 or NA (not applicable)/NS (not scored). All queries, data sources, and evidence pieces are weighted against one another in a matrix system to arrive at a final top-level score. Clicking on specific cells will load the underlying evidence and information on how it has been assessed.
Fossil fuel companies are those whose primary sector falls within coal mining and services, or up-, mid-, and downstream oil and gas sectors. Green companies are defined as companies having over 75% revenue deriving from Substantial Contribution to Mitigation activities under the EU Taxonomy.
Portfolio Paris Alignment analysis of this institution's activities in this portfolio area assesses deals in 2020–2022.
Value Assessed: $210B
Sector Paris Alignment scores for the sectors to which this portfolio has exposure. FinanceMap Paris Alignment analysis is limited to the automotive, upstream fossil fuel, and power sectors.
Fossil fuel companies are those whose primary sector falls within coal mining and services, or up-, mid-, and downstream oil and gas sectors. Green companies are defined as companies having over 75% revenue deriving from Substantial Contribution to Mitigation activities under the EU Taxonomy.
Portfolio Paris Alignment analysis of this institution's activities in this portfolio area assesses deals in 2020–2022.
Value Assessed: $92.0B
Sector Paris Alignment scores for the sectors to which this portfolio has exposure. FinanceMap Paris Alignment analysis is limited to the automotive, upstream fossil fuel, and power sectors.
Fossil fuel companies are those whose primary sector falls within coal mining and services, or up-, mid-, and downstream oil and gas sectors. Green companies are defined as companies having over 75% revenue deriving from Substantial Contribution to Mitigation activities under the EU Taxonomy.
Portion of AUM Assessed: $7.4B
| Holding Name | Contribution to Sector Production |
|---|---|
| CLP Holdings Ltd | 18.0% |
| Emera Inc | 9.5% |
| Algonquin Power & Utilities Corp | 8.3% |
| CMS Energy Corp | 6.6% |
| Exelon Corp | 5.9% |
| Fortis Inc | 4.7% |
| Tenaga Nasional Bhd | 3.7% |
| DTE Energy Co | 3.0% |
| Enel SpA | 2.6% |
| TransAlta Corp | 2.5% |
| Holding Name | Contribution to Sector Production |
|---|---|
| Toyota Motor Corp | 49.3% |
| Stellantis NV | 11.8% |
| Honda Motor Co Ltd | 5.6% |
| Volkswagen AG | 5.3% |
| General Motors Co | 4.2% |
| Ford Motor Co | 3.8% |
| Suzuki Motor Corp | 3.8% |
| Mercedes Benz Group AG | 3.0% |
| Nissan Motor Co Ltd | 3.0% |
| Tesla Inc | 2.4% |
| Holding Name | Contribution to Sector Production |
|---|---|
| Glencore PLC | 85.5% |
| Whitehaven Coal Ltd | 11.3% |
| Washington H Soul Pattinson and Company Ltd | 3.2% |
| Holding Name | Contribution to Sector Production |
|---|---|
| Canadian Natural Resources Ltd | 17.6% |
| Suncor Energy Inc | 12.5% |
| Tourmaline Oil Corp | 5.1% |
| BP PLC | 4.9% |
| Shell PLC | 4.7% |
| Chevron Corp | 4.5% |
| Exxon Mobil Corp | 4.3% |
| Mitsui & Co Ltd | 3.9% |
| ARC Resources Ltd | 3.6% |
| Conocophillips | 3.4% |
TD Asset Management (TD AM) does not appear to be firmly engaging with companies on climate. Climate engagement appears to have a defined structure, for example, the asset manager develops an annual Climate Focus List based on the issuer’s historical environmental performance, assessment of climate targets, and the assets under management. It states it strives to track and engage companies that do not report their GHG emissions or do not have net zero aligned targets, but it is unclear whether it uses milestones to measure engagement progress. Additionally, it is unclear whether it has defined an engagement escalation strategy.
Although the asset manager states engagements under its Climate Focus List are focused on encouraging companies to publish Scope 1, 2, and 3 emissions, set SBTs that are aligned with net zero by 2050, and detail tactics to achieve emissions targets, it does not provide examples of company engagements to support this. Given its lack of engagement case studies, it is unclear whether the asset manager has driven behavior change on climate. TD AM does not appear to be engaging with companies on climate policy influence. It appears to be engaging in various collaborative initiatives including CA100+ and Climate Engagement Canada, but it is unclear the extent to which it has contributed to these initiatives.
TD AM has outlined its stewardship governance structure and processes, referencing how the work of the ESG Committee is communicated to upper management. It has limited transparency on engagements, providing some anonymous case studies in its quarterly voting reports. The asset manager discloses all of its proxy voting data as well as its proxy voting guidelines but does not provide voting justifications. TD AM does not appear to be willing to use its shareholder authority to file Paris Aligned shareholder resolutions or publicly vocalize its support for such resolutions.
Insightia data suggests that TD has become increasingly supportive in recent years of AGM resolutions InfluenceMap categorizes as in line with the Paris Agreement, supporting 32% in 2019, 52.6% in 2020, 82.5% in 2021, and 73.7% in 2022.
FinanceMap's methodology to measure the engagement process on climate was developed in consultation with several of the world's leading asset managers and uses key aspects of the UK Financial Reporting Council's 2020 Stewardship Code . The Stewardship Code was chosen to benchmark engagement quality as it provides an ambitious framework and detailed definitions of what constitutes effective engagement. FinanceMap defines the term ‘engagement’ as referring to all investor actions undertaken to influence the management strategy of the companies they own including private communications with corporate management and appointed advisors; questions at AGMs/other company meetings; comments on the company in the media; escalation and the shareholder resolution process (filing, voting behavior). FinanceMap’s methodology breaks the engagement process down into a set of sub-activities and looks for evidence associated with these across publicly available data sources.
Climate-relevance categorization of shareholder resolutions is based on the IPCC’s Special Report on 1.5°C and its concluded need for “rapid and far-reaching transitions in land, energy, industry, buildings, transport, and cities.” FinanceMap scored voting on any resolution where the intent and likely outcome is consistent with this IPCC stated need. The voting data is drawn from asset managers' disclosures to the US Security Exchange Commission (SEC), asset manager websites (including third-party websites they link to), directly from the asset managers, and through specialist voting data provider Insightia. The full list of resolutions assessed is available here.
The following table outlines the key queries and data sources, which FinanceMap uses to assess asset managers' corporate engagement programs. Every evidence piece is assessed on a five-point scale of -2,-1,0,1,2 or NA (not applicable)/NS (not scored). All queries, data sources, and evidence pieces are weighted against one another in a matrix system to arrive at a final top-level score. Clicking on specific cells will load the underlying evidence and information on how it has been assessed.
TD Bank Group (TD) and its asset management subsidiary TD Asset Management (TDAM) appear to have had limited transparent engagement on sustainable finance policy, disclosing that they are engaged on a variety of policy areas without disclosing positions on these policies.
TD has recognized climate change as a systemic risk but it is unclear whether it supports systemic reforms to address this risk. TD has stated support for keeping global temperature rise to 1.5C and has advocated for broader action to achieve the goals of the Paris Agreement. In October 2021, TD Bank joined the Glasgow Financial Alliance for Net Zero's banking arm, the Net-Zero Banking Alliance, signaling a commitment to the goal of net zero emissions by 2050. Also in October 2021, TDAM signed onto joint statements supporting the goal and calling on governments to limit temperature rise to 1.5C. However, a letter submitted to the Municipal Advisory Council of Texas in December 2022 shows evidence of TD Securities’ support for continued investments in fossil fuels. In its 2022 Public Policy and Political Contributions report TD mentioned engaging with Canadian and US governments on sustainable finance policy, but did not outline details of this engagement. TDAM and TD Insurance have also mentioned engagement on sustainable finance policies but details are similarly unclear.
TD appears engaged on regulated corporate ESG disclosure with somewhat unclear positions. In its 2022 climate reporting suite, TD and TDAM describe mostly indirect engagement on specific disclosure policies, including standards in development by the US Securities and Exchange Commission (SEC), Canadian Securities Association (CSA), and International Sustainability Standards Board (ISSB) . In October 2021, TDAM signed onto a joint statement calling for governments to implement mandatory disclosure requirements aligned with the TCFD. In TD’s 2022 CDP Response, it stated “support with minor exceptions” for mandatory climate-related reporting. A May 2023 memo from the SEC shows that CEO Bharat Masrani met with the SEC to discuss its climate disclosure proposal, though details of this meeting are unclear.
In its 2022 Climate Action Report, TD described indirectly engaging on ongoing efforts by financial regulators to embed climate risk into regulation and supervision of financial institutions, but did not take a position on these efforts. In its 2022 CDP Response TD stated “support with minor exceptions” for the Canadian Office of the Superintendent of Financial Institutions (OSFI) climate risk work. A memo from the Office of the Comptroller of the Currency (OCC) details a March 2022 meeting with the Bank Policy Institute and its constituents, including representatives from TD Bank, where BPI and its constituents outlined the “challenges” of implementing the OCC’s proposed Principles for Climate-Related Financial Risk Management for Large Banks.
TD has published a list of its industry association memberships and disclosed engagement on specific policies via some associations, but has not provided details on the outcomes sought throughout these engagements.
InfluenceMap’s methodology for assessing lobbying on sustainable finance policy closely follows InfluenceMap’s established methodology on climate policy engagement, which is used extensively by investors, including via the Climate Action 100+ investor engagement process. Our full methodology can be found here.
Under our assessment of sustainable finance lobbying, InfluenceMap considers engagement on all financial policies which intersect with climate and/or other sustainability issues. The analysis takes into account both the engagement of the financial institution and the activities of industry associations they hold membership of.
InfluenceMap’s methodology covers seven publicly available data sources, searching for evidence of engagement and corporate positioning since 2017. To determine the policy issues within the scope of the analysis, InfluenceMap breaks down sustainable finance policy engagement into a series of subcategories, or 'queries'. These are designed to cover high-level issues relating to the importance of sustainable finance, as well as more specific areas of sustainable finance policymaking. InfluenceMap’s research process searches for evidence of an organization's engagement with each sustainable finance policy issue, across each of the data sources.
The following table outlines the key queries and data sources, which FinanceMap uses to assess financial institutions’ sustainable finance policy engagement. Every evidence piece is assessed on a five-point scale of -2,-1,0,1,2 or NA (not applicable)/NS (not scored). All queries, data sources, and evidence pieces are weighted against one another in a matrix system to arrive at a final top-level score. Clicking on specific cells will load the underlying evidence and information on how it has been assessed.
In this section, we depict graphically the relationships the corporation has with trade associations, federations, advocacy groups and other third parties who may be acting on their behalf to influence climate change policy. Each of the columns above represents one relationship the corporation appears to have with such a third party.
In these columns, the top, dark section represents the strength of the relationship the corporation has with the influencer. For example if a corporation's senior executive also held a key role in the trade association, we would deem this to be a strong relationship and it would be on the far left of the chart above, with the weaker ones to the right. Click on these grey shaded upper sections for details of these relationships. The middle section contains a link to the organization score details of the influencer concerned, so you can see the details of its climate change policy influence. Click on the middle sections for for details of the trade associations. The lower section contains the organization score of that influencer, the lower the more negatively it is influencing climate policy.
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
TD Bank is a member of BPI.
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
As of December 2022, Bharat Masrani no longer appears to be on the board of BPI.
Bharat Masrani (Chairman of the Board, TD Bank)
--no extract--
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
TD Bank is a member of BPI.
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
As of December 2022, Bharat Masrani no longer appears to be on the board of BPI.
Bharat Masrani (Chairman of the Board, TD Bank)
--no extract--
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
TD Bank is a member of the American Bankers Association.
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Candice Cambridge sits on the board of the American Bankers Association Community Engagement Foundation.
Candice Cambridge (Head of Community Development Service Strategy, TD Bank)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
TD Bank is a member of the American Bankers Association.
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Candice Cambridge sits on the board of the American Bankers Association Community Engagement Foundation.
Candice Cambridge (Head of Community Development Service Strategy, TD Bank)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
TD Bank NV & TD Securities Ltd are members of UK Finance, which is a member of EBF (last checked September 2023).
not specified
--no extract--
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
TD Bank NV & TD Securities Ltd are members of UK Finance, which is a member of EBF (last checked September 2023).
not specified
--no extract--
Open PDF file of Data Source
Open PDF file of Data Source