Canadian pension fund invests in ex-plantation privatizing Hawaii’s water

Mahi Pono fields, reservoir and dump in Maui, Hawaii. (Photo: Forest and Kim Starr)
The Breach | 23 February 2022
Canadian pension fund invests in ex-plantation privatizing Hawaii’s water
by Justin Brake
The vast network of canals, ditches and tunnels that pockmark the eastern part of Maui betray a history of U.S. plantation agriculture that dates back 150 years.
When the last sugar plantation was shuttered in 2016 on the second-largest of the Hawaiian islands, it gave locals a boost in their efforts to return a depleted watershed to health. Those efforts are part of a broader decolonization movement led by Kanaka Maoli, who have reclaimed traditional practices, including farming for the root vegetable taro, that depend on these rivers. 
But a new threat to the free flow of East Maui’s water has now emerged: one of Canada’s largest pension funds.
The Public Sector Pension Investment Board (PSP Investments)—which invests on behalf of employees in Canada’s federal public service, the Royal Canadian Mounted Police, the Canadian Forces, and the Reserve Force—recently invested $600 million in a major farming operation that is trying to secure a long-term lease on the same waters that locals say they have a constitutionally-protected right to access.
Native Hawaiians, farmers, environmental groups and local politicians are denouncing it as a “crime” and “continuation of the plantation legacy,” and say it will maintain the privatization of their waters. 
If the company jointly owned by the Canadian pension fund is able to secure a 30-year license, they will net cheap commercial water and higher returns for Canadian pensioners. 
But if the lease ends up with the local county, prices could be set more equitably—making it more affordable for residents instead of the foreign agricultural companies that seem to be refusing, to this day, to relinquish their hold over Hawaiʻi.
The “dewatering” of Hawaiʻi
Five years ago, the closure of the operations of the Hawaiian Commercial & Sugar Company—owned by the American Alexander & Baldwin firm that long dominated the island’s industry—was seen by many on Maui as a potential end to the century-and-a-half-long seizure of water resources vital to local identity and ways of life. 
But before long, powerful new players began circling East Maui’s agricultural lands and vying to secure long-term access to its waters. 
In late 2018, PSP Investments and a California-based agricultural company jointly bought up 41,000 acres of agricultural lands from the former plantation owners. 
Their new venture—which produces macadamia nuts, citrus fruits, coffee, and avocado and farms cattle—is named Mahi Pono, which loosely translates as “to cultivate the land responsibly” in Hawaiian. 
But locals say Mahi Pono’s interests stand in direct opposition to their rights. 
Ed Wendt, a Kanaka Maoli elder and taro farmer from Maui who has been fighting for Native Hawaiian water rights for decades, says locals are “very concerned” about the possibility of Mahi Pono winning a new long-term water lease. 
Control of water was first taken from Indigenous communities as part of the overthrow of the Hawaiian Kingdom and the US annexation of Hawaiʻi in the 1890s. 
“We were completely de-watered,” Wendt told The Breach from his home in Hawaiʻi. 
Without the waters in East Maui, he says, Kanaka Maoli were unable to maintain their spiritual ties to taro and to the lands. As a result, many were forced to leave the island.
In recent years he and a new generation of returning young farmers have achieved legal victories recognizing the need for full restoration of some of East Maui’s streams.
“But our problem is a foreign country controlling our water,” he said. “We support farming, but we need to take care of our resources.”
When it announced the purchase of the lands in December 2018, Mahi Pono President Ann Chin said the sale would “help ensure an agricultural future for Maui.”
But PSP Investments’s mandate isn’t to employ locals or support sustainable agriculture. Instead, the fund is legally bound to maximize returns on its investments. 
PSP’s track record: privatization and extractivism
This isn’t the first time Canadian pension funds have come under fire for funding public sector workers’ retirements on the backs of people abroad. 
Last year The Breach exposed the scale of another investment by the Canada Pension Plan Investment Board in far-right President Jair Bolsonaro’s water privatization scheme in Brazil. 
For its part, PSP Investments invested nearly half a billion dollars in water rights in Australia amid ongoing droughts and other dire consequences of climate breakdown.
“The PSP Investment Board must stop facilitating the privatization of water rights and infrastructure around the world, which has reduced access to water and increased costs for those who can afford to pay,” Mark Calzavara, water campaigner for the Council of Canadians, wrote The Breach in an email.
PSP Investments did not reply to requests for comment from The Breach. 
In 2020, NDP MP Alistair MacGregor introduced a bill into the House of Commons that would have amended the Canada Pension Plan Investment Board Act, so that this other major pension fund would have to invest ethically. The proposed legislation was defeated by the Liberals and Conservatives.
“For years, public sector pension funds have resisted implementing any ‘ethical’ investment screens by claiming they have a legal obligation to get the highest return on investment possible—as long as it is not illegal,” Calzavara said.
That means that PSP Investments currently follows its own so-called Environmental, Social and Governance (ESG) investment guidelines. 
While it was assessing the Mahi Pono project, according to its 2019 Responsible Investment Report, it considered the “sustainability of the water required for operations and the potential long-term impact of climate change.” 
Omitted from the report is any mention of Indigenous rights or resistance from locals.
A report published last year by the Maui ESG Investment Project—an organization that monitors investments in Hawaiʻi—found that PSP Investments is not living up to its own guidelines.
“The sale of the Alexander& Baldwin sugar plantation represented a unique moment for Maui to be freed from its colonial past toward a more diverse and egalitarian economy,” reads the report. 
“Mahi Pono and the PSP Investment Board are continuing the plantation legacy of dewatering the streams, with devastating impacts on native Hawaiian communities,” Shay Chan Hodges, co-author of the report, told The Breach by email.
Whether the water lease for Mahi Pono will be extended now rests in the hands of Hawaii’s Department of Lands and Natural Resources.
Since water is a constitutionally-protected public trust in Hawaiʻi, the department must theoretically balance the corporation’s request with demands from representatives of Kanaka Maoli and Maui county.
The Office of Hawaiian Affairs and the local Maui County Council are mounting pressure to take over the water lease, so jurisdiction over east Maui waters can be  returned to locals.
For his part, Wendt says he has been happy to see young Native Hawaiians returning to East Maui to farm taro and reconnecting with the lands and waters of their ancestors. 
But he calls the long-term lease of any Maui waters to Mahi Pono “a crime.” 
“If Mahi Pono takes it for 30 years, we’re at their mercy.”
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