By Autumn Demberger, Global AgInvesting Media
A first-of-its-kind deal between two of the world’s largest pension markets has launched earlier this month. A group of major Canadian pension funds, including CPP Investments, and a group of Australia’s largest industry superannuation funds have formed a pact under the Canadian-Australian Pension Funds Investment Initiative (CAP Invest Initiative) to lobby for policy changes that would help fast-track investments in both countries.
Participants of the deal, brokered by super fund-owned asset manager IFM Investors, signed a Memorandum of Understanding (MOU) in the hopes to unlock greater pension capital as well as facilitate dialogue with governments on policy barriers and associated solutions to improve the business environment for investment in each jurisdiction. The long-term hope is to unlock greater capital for private investment on behalf of millions of working and retired people.
The announcement came as Canadian Prime Minister Mark Carney began a four-day diplomatic visit to Australia in Sydney, with the aim of bolstering the connection between the two countries.
The agreement does not commit to a specific dollar amount to be deployed by the pension funds in both nations. Instead, it has been characterized as an “MOU for partnership,” enabling infrastructure investments in both nations as a significant focus of the deal.
“Our job through this partnership is to really look at the frictions that are prohibiting us from making those deployments and see whether we can work with governments at the national and sub-national level to eliminate those frictions,” IFM Investors chair Cath Bowtell said at a press conference in Sydney.
Global Significance of the Deal
Canada and Australia foster some of the world’s largest growing pension systems, the second and fourth, respectively, with assets expected to reach $CAD10 trillion (A$22t) in Australia and CAD$8 trillion (A$9t) in Canada by 2040.
“With a shared heritage, open and resource-rich economies, strong credit worthiness, and reliable and transparent legal institutions, we believe there is fertile ground to bolster opportunities for investment between Canada and Australia,” IFM Investors stated in its press release on the deal.
Both systems provide major capital for real assets globally. Canadian pension funds are notable for their diversified investments in private markets, supported by the “Canadian model,” which features independent governance and large in-house investment teams. Australian pension funds became early investors in infrastructure during the 1990s when government privatization of transport, utilities, and telecommunications created opportunities for large domestic investments.
Additionally, Canadian and Australian pension funds are globally some of the largest allocators to infrastructure. According to Macquarie Asset Management’s “Infrastructure portfolio allocation: What could optimal look like?” report released in April 2025, Australian pension funds allocate 6.8% to unlisted infrastructure, while Canadian pension funds allocate 10.1%.
The CAP Invest Initiative Signatories
From Australia
- Australian Retirement Trust
- AustralianSuper
- Aware Super
- CareSuper
- Cbus
- HESTA
- Hostplus
- IFM Investors
- Rest
From Canada
- Alberta Investment Management Corporation
- British Columbia Investment Management Corporation
- La Caisse
- CPP Investments
- Healthcare of Ontario Pension Plan
- Investment Management Corporation of Ontario
- Ontario Municipal Employees Retirement System
- Ontario Teachers’ Pension Plan
- Public Sector Pension Investments
Why It Matters
The CAP Invest Initiative represents a major shift in how the world’s two largest pension markets collaborate. Both nations increasingly classify sustainable farmland and “natural capital” as critical real-asset infrastructure, something likely bolstered by the initiative.
One of the primary goals of the MOU is to jointly lobby governments to eliminate some of the regulatory and policy barriers that could potentially slow down capital deployment.
Leaders from both sides have released in a joint statement their commitment to promoting cooperation between regulators that helps to facilitate access to safe, effective and efficient agricultural inputs, including feeds, fertilizers, crop protection products, and pest control technologies, in both jurisdictions. These arrangements of inputs would aim to leverage the environmental, health and safety assessments conducted by either country to support the authorization of products that advanced economic prosperity and food security, and bolster trade, while ensuring the protection of human and animal health and the environment.
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