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June 19, 2018


Cryptocurrency Not Ready For Mainstream

The Bank for International Settlements (BIS) has told the cryptocurrency world it’s not ready for mainstream financial services. In annual economic report, it says Bitcoin and other cryptocurrencies suffer from “a range of shortcomings” that would prevent them from fulfilling the expectations that prompted an explosion of interest ‒ and investment ‒ in the would-be asset class. It says cryptocurrencies are too unstable, consume too much electricity, and are subject to too much manipulation and fraud to ever serve as bona fide mediums of exchange in the global economy. It cited the decentralized nature of cryptocurrencies ‒ they are created, transacted, and accounted for on a distributed network of computers ‒ as a fundamental flaw rather than a key strength. The BIS does say that blockchain and its distributed ledger technology do provide some benefits for the global financial system. It can make sending cross-border payments more efficient and trade finance is ready for the improvements offered by Blockchain-related programs. However, as the size of these ledgers swell, it will eventually overwhelm everything from individual smartphones to servers.

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Asset Owners Pursue ESG

Eighty-four per cent of asset owners globally are pursuing or considering ESG investing, says a survey by the Morgan Stanley Institute for Sustainable Investing and Morgan Stanley Investment Management. Among the 70 per cent of owners who already are incorporating environmental, social, and governance (ESG) factors into their investment decisions, 60 per cent began doing so in the past four years and 37 per cent within the past two years. Risk management (78 per cent) was cited as the biggest factor driving ESG adoption, followed by return potential and mission alignment at 77 per cent each. Despite many asset owners citing performance as an important factor driving their adoption of sustainable investing, respondents said proof of market-rate financial performance was the biggest challenge to ESG adoption (24 per cent), followed by quality ESG/sustainability data (23 per cent), and supply of quality managers/strategies (20 per cent).

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Millennials Less Likely To Be ‘Gig’ Workers

While the term ‘gig economy’ may conjure images of Millennials driving for Uber, the reality is that workers in alternative employment arrangements are far more likely to be Gen Xers or Baby Boomers, says a EBRI ‘Perspective.’ It cites the Bureau of Labor Statistics’ (BLS) ‘Contingent and Alternative Employment Arrangements’ supplement which shows that 10.6 million workers identified themselves as independent contractors ‒ 6.9 per cent of total employment. Of this group, by far the largest cohort is workers ages 55 or older at 37 per cent. This compares to the 22 per cent of workers with traditional work arrangements that are in this age cohort. The report says that 79 per cent of independent contractors prefer their work arrangements to traditional jobs. However, the report also notes that, in general, the proportion of workers in alternative employment arrangements who actually participate in employer-provided retirement plans is lower than for those in traditional arrangements.

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European Investors Seek Diversification

Institutional investors across Europe continue to seek diversification in asset allocation and are taking climate change into consideration more than ever, says a Mercer survey. A growing number of investors are also looking to hedge equity downside risk, with equity option strategies gaining popularity over the year. The European Asset Allocation Survey 2018’ survey found nine per cent of respondents have implemented equity-option protection strategies, while a further 24 per cent of plans have considered taking this approach. Climate change risk is also growing as a consideration among plans, with 17 per cent of respondents considering the implications for their investments, compared to five per cent last year. Plan future asset allocation will continue to reduce exposure to equities, with domestic government bonds, corporate bonds, and other matching assets set to benefit from this move.

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SSQ Launches New Website

SSQ Insurance has launched its new website in collaboration with digital experience company Acquia. The ssq.ca website overhaul had two key components – replacing the content management software and revamping its look-and-feel. The multiple components of the Acquia intelligent Platform and marketing tools will enable SSQ Insurance to manage, customize, and improve its online customer experience at every touchpoint. The Drupal CMS, which is both modern and efficient, offers the functionality and agility required to support the complete execution of the company’s customer centre and various initiatives related to honing customer services. Changing the CMS to Acquia’s digital experience platform led SSQ Insurance to fully integrate its new brand identity into and update the look-and-feel of its website. The site’s architecture and navigation setup were entirely redesigned in order to enhance user experience on every type of device.

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Haager Leads Health

Sebastian Haager is a principal and office business leader for health at Mercer Canada. He will focus on executing all aspects of the health and benefits strategy in Calgary, AB, including client development, client management, and overall growth. With almost 15 years of experience in the insurance industry, he previously held account management, business development, and leadership positions. 

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PPAC Course Offered

The CPBI Saskatchewan Regional Council, in partnership with Humber College, will again offer the ‘Pension Plan Administration Certificate (PPAC) 1.’ The first of three modules in the PPAC program offered, it is designed for anyone from pension plan administrators to HR professionals in the industry and pension committee members. It takes place September 17 to 21 in Regina, SK. For information, visit PPAC

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June 18, 2018


Diversity Has To Happen

Hugh O’Reilly, president and CEO of OPSEU Trust, has been talking about diversity in the boardroom for 40 years and “it has to happen,” he told a panel discussion with Gordon Fyfe, CEO and CIO of the British Columbia Investment Management Corporation, and Kevin Uebelein, CEO of Alberta Investment Management Corporation, at the Canadian Coalition for Good Governance’s annual meeting. He said if it starts with gender diversity, even if that means mandate quotas for women on boards of directors, “we’ll find nothing bad will happen with more women on boards.” Even though it is a critical factor, it is something Canada “as a country, has not done well” and in this age of disruption diversity is important for survival. Fyfe echoed his comments, saying a lack of diversity means opportunities could be missed. One way to help deal with the diversity challenge is to have term limits for board members. This would address the age issue as well as encourage not just gender diversity, but age diversity and cultural diversity on boards. He also talked about the challenge of managing a large pension fund with limited resources. Balancing the interests of plan members and the board of trustees tops his list of challenges, but this has to be done with the legislation governing the plan. In fact, some member values diverge greatly from what the plan is able to do. This is compounded by limits on resources which makes it challenging to decide which issue to deal with. “There are issue we want to deal with, but we can’t,” he said. Uebelein offered a holistic issue he called critically important ‒ short termism. When his board meets, they may have thousands of pages to go through with the majority dealing with issues from that quarter. It means they don’t have the opportunity to think about the long term because these may not result in better performance over the next quarter. They need to be convinced that taking a long-term view will improve performance.

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Smart Pension Infrastructure Developed

A technology startup, Akropolis, founded by ex-Lehman Brothers fund manager Anastasia Andrianova, is building a new smart contract based pensions infrastructure it believes can fix the worldwide pensions crisis. The new protocol is designed to pre-empt and render these issues impossible for the future generations by acting as a decentralized marketplace and data exchange with a modular smart-contract platform. The open nature of the protocol promises transparency built in at the protocol level. No single entity can be in control of the ledger and once data is appended, it can’t be erased or edited. The risk of fund seizures, hidden costs, mis-selling, and surprise payouts is nullified. Control of pensions is given back to the individual users who can be directly connected with fund managers and financial institutions ‒ bringing clarity and cutting out the middlemen that siphon value out of investments. Meanwhile, institutional participants are incentivised for accountability and transparency. Participants can rate funds and organizations, which are accurately and immutably stored on the blockchain for everyone to see – allowing others to make better-informed choices when it comes to picking a pension plan. The ledger also guarantees pension portability. The friction and hassle of moving from one employer to another ‒ a common occurrence in the modern mobile economy ‒ is no longer an issue as funds can easily be tracked. 

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Advisors Turn To Active Managers

Advisors are turning to active managers and deploying alternative investments to manage new and numerous risks facing their clients, says a Natixis Investment Managers survey. Nearly nine in 10 (86 per cent) advisors say the risks in the market add up to an environment that favours active management. These professionals demonstrate a clear preference for actively managed investments and continue to allocate the majority of assets to these strategies and now have 72 per cent allocated to active management. Passive strategies are used mainly for their lower fees (56 per cent).

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Market May Have Manipulated Bitcoin

The Bitcoin craze that took the stock markets by storm last year may have been no more than market manipulation, says a study by the University of Texas. It claims that Tether, a digital currency tied to the U.S. dollar, may have been used to artificially inflate Bitcoin prices as at least half of the 2017 rise of Bitcoin prices could be attributed to co-ordinated price manipulation. “These patterns cannot be explained by investor demand proxies, but are most consistent with the supply-based hypothesis where Tether is used to provide price support and manipulate cryptocurrency prices,” it says. Fearing that market manipulation may play a factor in the value of cryptocurrencies, the United States Department of Justice launched a criminal probe at the end of May into whether traders were manipulating the price of bitcoin and other digital currencies. The investigation is looking at potential illegal practices that could influence prices such as flooding the market with fraudulent orders to trick other traders. Bitcoin’s value reached an all-time high of over US$20,000 at the end of 2017, but its value has since dropped and was $6,370 last week.

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MacDonald Has New Role

Kenneth MacDonald is manager, SMB, for western Canada at Morneau Shepell. He joined the firm in September of 2015 as a senior consultant.

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ACPM Looks At ‘Next 150’

‘The Next 150: Fortifying Retirement for the Future’ is the theme of the ‘2018 ACPM National Conference.’ It will address the current and future retirement income challenges in presentations on a variety of issues including pensions and public policy, infrastructure investment, risk from the member perspective, and changing capital accumulation plan behaviours. It takes place September 11 to 13 in Quebec City, QC. For information, visit ACPM Conference

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June 15, 2018


Cryptocurrency Revolutionizing Life

Cryptocurrency is an inaccurate and non-inclusive description of what it really is, says Jack Tatar, author and managing partner at Doyle Capital Management. During the Canadian Association of Alternative Assets and Strategies (CAAAS) debate ‘Be it resolved that cryptocurrencies are here to stay and will revolutionize modern life beyond belief over the next 20 years,’ he said he prefers to describe them as cryptoassets. Created in 2008, they were intended to address shortcomings in the monetary system exposed during the financial crisis. They are a currency which is decentralized in its purest sense as there is no government or entity to control it. The question and the challenge are how much will the status quo fight it, he said. Michael Gord, founder and CEO at MLG Blockchain, said 99 per cent of digital currencies that exist today will not exist in the future. These include blockchain networks that are not making money and if cash flow can’t sustain them, there is no community and tokens become valueless. In order to have value, large communities are needed and real world businesses need to agree on value of tokens and accept them as payments. A critical factor, said Tatar, is they need to be evaluated the same as traditional assets to determine if they are worth investing in. It comes back to those things investors have done for years ‒ due diligence and good research, he said.

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RIA Sets Out Priorities

The Responsible Investment Association (RIA) has set out its strategic priorities over the three-year period from June 2018 to June 2021. It will focus on five core strategic priorities to drive the adoption of responsible investment in Canada’s retail and institutional markets. To drive demand for responsible investments, it will engage and educate asset owners and investment consultants about responsible investing and raise awareness of responsible investment among the investing public. To develop the RI capacity of investment professionals, it will support the development of RI literacy and RI expertise for RIA members. This involves delivering, refining, and promoting RI training and certification for advisors, portfolio managers, analysts ,and other professionals including beginners and experienced practitioners. To shift public policy and regulation towards frameworks that are more conducive to responsible investment, it will proactively engage with regulators and government to promote a policy/regulatory environment that is conducive to responsible capital markets. It will also provide a strong voice for the RI industry via mainstream, industry, and social media outlets. The RIA will report on progress through its Canadian RI Trends Report, the RIA Investor Opinion Survey, and its annual report. It will also track total assets under management of member firms and track advisor assets.

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MiFID II Reducing Research

European asset managers are receiving a lower amount of stock and bond research now that they are mainly paying for it and they feel “worse off” as a result, says an RSRCHXchange survey. The Markets in Financial Instruments Directive II (MiFID II), which causes firms to unbundle research from execution costs, has hit smaller asset managers and small cap companies hardest with 82 per cent believing it would result in reduced coverage for small and midcap stocks. The survey also found 83 per cent of those in the U.S. thought unbundling would take effect within the next four years and 53 per cent of respondents in Asia expected it to take effect within two years. The smallest firms believe that change will come through regulation, whereas the largest firms believe it will be global compliance policies that will be the root cause of proliferation. Attitudes to unbundling in Europe are generally negative, but most respondents believe that it is positive for end investors, although negative for research providers and mixed for asset managers themselves.

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Market Volatility Concerns Advisors

Following lackluster returns in the Canadian stock market in 2017, financial advisors are concerned that higher levels of market volatility, interest rate hikes, and possible asset bubbles threaten investment returns for 2018, says a Natixis Investment Managers survey. This environment can also lead investors to make costly mistakes and managing the emotional reactions of clients could be advisors’ greatest challenge in 2018, it says. Financial advisors have their work cut out as they navigate through the market’s choppy waters. As survey respondents strive to grow assets under management by an average of 14 per cent over the next 12 months, they see several potential roadblocks. Advisors see rising volatility as the biggest potential threat to the markets. Seventy-three per cent say it would negatively affect overall investment performance; trailing as perils are asset bubbles (63 per cent), geopolitical events (57 per cent) unwinding of quantitative easing (57 per cent), interest rate increases (56 per cent), the low yield environment (55 per cent), regulation (43 per cent), and currency fluctuations (41 per cent). They also believe there are asset bubbles in the real estate market (49 per cent), the tech sector (23 per cent), the stock market (23 per cent), and bond market (22 per cent). They show the most concern for cryptocurrencies. After those currencies experienced a considerable run up in 2017, 69 per cent of respondents see them as a potential bubble that could burst in 2018.

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Russia Raising Retirement Age

Russia is set to raise the retirement age by five years for men and by eight years for women. Starting next year the retirement age for men will gradually rise by 2028 to 65 years old from 60. For women, the age will gradually rise to 63 by 2034 from the current retirement age of 55. The move will help the government increase state benefits beyond the level of inflation. A number of factors made the changes necessary, including that life expectancy has grown by more than 30 years since the retirement age was set in the 1950s. As well, almost all countries have already raised the retirement age and Russia’s current age was one of the lowest.

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Members Would Accept Information

Sixty-six per cent of plan members would consent to receive information on personal health issues based on their use of benefits and drug claims, says the 21st edition of ‘The Sanofi Canada Healthcare Survey.’ Plan sponsors are aligned with this as 64 per cent are interested in their insurance carrier sending targeted health information to consenting plan members. Plan members are most interested in receiving targeted information about their medications (52 per cent), recommended local healthcare professionals or experts (51 per cent), and how to manage their conditions (47 per cent).

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Work From Home Has Pitfalls

Job seekers are enticed by work from home options, but are aware of the pitfalls, says research from Robert Half. Nearly two-thirds of Canadian professionals surveyed (65 per cent) said they are more likely to accept a job offer if there’s the possibility of telecommuting at least some of the time. The top drawbacks of telecommuting, says the survey, include feeling isolated and missing a team environment (26 per cent), people abusing the benefit (20 per cent), and strained interpersonal relationships due to lack of face time (16 per cent). “The ability to work remotely is just one of many perks job seekers look for when considering a potential employer,” says Greg Scileppi, president of Robert Half, International Staffing Operations. “To appeal to top talent, managers must evaluate what candidates want against their total compensation package and determine where they can incorporate benefits like flexible work options in ways that align with business goals and obligations.”

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Belgium Knights Mock

Ron Mock, president and chief executive officer of the Ontario Teachers’ Pension Plan (Ontario Teachers’), has been presented with Belgium’s ‘Commander of the Order of the Crown,’ one of the highest distinctions in the national orders of the Kingdom of Belgium. The award, an honorary order of knighthood, is in recognition of meritorious service to the Belgian state. As of December 2017, Ontario Teachers’ had more than $1.7 billion invested in Belgium, including ownership of 39 per cent of the Brussels Airport.

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Volpe Heads Canada

Sonja Volpe is president and chief executive officer for Canada for BNP Paribas, effective July 1. She will be responsible for overseeing the full breadth of the Canadian business while continuing to lead financial institutions coverage in Canada. She joined the firm in 2015 as head of financial institutions coverage in Canada from Citibank Canada where she was a senior banker.

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Medicalization Of Unhappiness Examined

The Medicalization of Unhappiness’ will be examined at a CPBI Pacific breakfast session. Peter Gove, innovation leader, health management, at Green Shield Canada, will examine the history of mental illness in Canada, how it has been treated and/or gone untreated, and zero in on the changing medical and social landscape that has led to the proliferation of mental health diagnoses and the widespread prescribing of anti-depressants. It takes place June 21 in Vancouver, BC. For information, visit Medicalization

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June 14, 2018


Sponsors Underestimate Chronic Conditions

While 58 per cent of surveyed plan members report having at least one chronic disease or condition, plan sponsors believe only 29 per cent of their workforce have a chronic condition, says the 21st edition of ‘The Sanofi Canada Healthcare Survey.’ However, 77 per cent of plan sponsors indicate they are concerned about the impact of unmanaged chronic disease on the productivity of their workforce. Both groups are open to new benefit offerings in the area of chronic disease management, with a solid majority of plan members (66 per cent) who would consent to their benefit carriers analyzing their personal claims data in order to generate personal, targeted communications. A similar proportion of (64 per cent) of plan sponsors are interested in such a service from their benefit carrier. Just over half of plan sponsors (58 per cent) say they receive claims data analyses that identify the main disease states, yet only 19 per cent say they regularly receive such reporting. Meanwhile, almost half of employees with chronic conditions (47 per cent) report they have missed work or found it harder to do their jobs as a result; this climbs to 72 per cent among those with a mental health condition such as depression or anxiety. Eighty-four per cent of plan members with a chronic disease would like to know more about their condition and how to treat it; 79 per cent of plan sponsors would like their health benefit plan to do more to support plan members with chronic diseases.

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Great-West Offers CBT

The Great-West Life Assurance Company has joined Morneau Shepell in offering the employee assistance provider’s internet-based cognitive behavioural therapy (iCBT) platform. “CBT is proven to be one of the most effective therapeutic methods in treating a number of mental health conditions, but many people face challenges in gaining access to psychiatrists, psychologists, or therapists,” says Diane Bezdikian, senior vice-president of plan member services for Great-West Life. “With iCBT, eligible Great-West Life plan members who are diagnosed with depression or anxiety will have quick access to therapy in English or French, from anywhere, at any time, without having to travel to and from a therapist’s office.” The iCBT program does not replace therapists with a technology tool; rather, the program combines a therapist with a state-of-the-art program to create an effective platform to improve on traditional therapy.

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Quebec Eliminates Pension Disparities

Quebec’s elimination of disparities in pension and supplementary group benefits plans has met with mixed reaction. Bill 176 made additions to the province’s labour standards, including a clause which says “Any distinction made solely on the basis of a hiring date, in relation to pension plans or other employee benefits, that affects employees performing the same tasks in the same establishment is also prohibited.” The Conseil du Patronat du Québec, which represents Quebec employers, says this isn’t the right message to send if the province wants investment from national and international employers. “Parliamentarians have shown no interest or understanding about some of the significant negative impacts of the bill, specifically with respect to differentiated pension and benefits plans and the compensation of employment agency workers,” says Yves-Thomas Dorval, its president and chief executive officer. However, the United Steelworkers (USW) is hailing the law reforms. It says most private sector labour disputes in recent years have been provoked by attempts of employers to introduce two-tier pension and benefit plans, in which new workers receive substandard benefits compared to existing employees. “In 2007, USW members at Rio Tinto Fer et Titane in Havre-Saint-Pierre led the way in resisting two-tier pension demands, going on strike for four months rather than give up their defined benefit pension plan,” says Alain Croteau, Quebec Steelworkers director. “In 2016, USW members at Ciment Lafarge in Saint-Constant also rejected a two-tier pension plan. They were followed a year later by their fellow USW members at Resco and at Samuel et Fils. The new legislative reforms prohibiting two-tier pension and benefit plans come 17 years after the Quebec government enacted labour law amendments in 2001 that banned two-tier wage schemes in collective agreements.

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Investment In Blockchain Growing

The financial services industry is spending about $1.7 billion per year on blockchain as banks and other firms move beyond the proof-of-concept stage and start rolling out commercial distributed ledger technology (DLT) products, says a Greenwich Associates report. ‘Blockchain Adoption in Capital Markets ‒ 2018’ shows that blockchain budgets increased 67 per cent last year, with one in 10 of the banks and other companies now reporting blockchain budgets in excess of $10 million. Headcount dedicated to blockchain initiatives doubled in 2017 as banks and other firms launched new proof-of-concept projects or shifted top product implementation. Fourteen per cent of the banks and other companies in the study claim to have successfully deployed a production blockchain solution. Payments and trade finance are the businesses targeted most frequently.

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Companies Should Avoid Short-term Benchmarks

The Business Roundtable is advocating that publicly traded companies abandon strategies that emphasize short-term profits in favor of strategies that allocate capital for long-term growth. The Washington, DC-based group of blue-chip company CEOs says companies “should be managed for long-term prosperity, not to meet the latest forecast.” This means companies need to offer realistic quarterly projections and avoid making short-term decisions inconsistent with long-term strategies simply to beat short-term performance benchmarks.

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Gauthier Has New Role

Jean Gauthier (CFA) is managing director and chief investment officer – global fixed income ‒ at CIBC Asset Management. He joined the firm in November of 2017 as managing director and head of fixed income from the Ontario Teachers’ Pension Plan where he was a portfolio manager, fixed income and alternative investments. With over 25 years of fixed income experience, his extensive skill set will strengthen the team and help it meet future client needs.

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Cassisi Heads Client Services

Maria Cassisi is head of North American client services for Aviva Investors. She has more than 20 years’ experience of institutional business development and relationship management. In her new position, she will focus on delivering a superior experience for clients and consultants by co-ordinating teams across the region to deliver solutions in response to customer needs. Previously, she was head of strategic relationships, North America, at Standard Life Investments.

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Women And Retirement Security Examined

The latest trends in governance, telemedicine, and women and retirement security will be among the topics covered at the International Foundation of Employee Benefit Plans’ ‘51st Annual Canadian Employee Benefits Conference.’ Sessions will also look at the impact of chronic diseases, pension division on marriage breakdown, and innovation in timberland and farmland investing. It takes place August 20 to 23 in Las Vegas, NV. For information, visit Canadian Conference

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June 13, 2018


PSP Investments Assets Grow

The Public Sector Pension Investment Board (PSP Investments) ended its fiscal year March 31 with net assets of $153 billion, compared to $135.6 billion the previous fiscal year, an increase of 12.9 per cent. The investment manager reported a one-year total portfolio net return of 9.8 per cent on its investments and generated $13.5 billion of net income, net of all costs. This return is significantly greater than the policy portfolio benchmark return of 8.7 per cent. All asset classes saw strong returns. Public markets had net assets under management of $76.7 billion, a decrease of $0.5 billion from fiscal year 2017 and generated investment income of $6.3 billion, for a one-year return of 8.3 per cent, compared to a benchmark of 7.7 per cent. Public markets continued to generate significant returns in fiscal year 2018, despite increased geopolitical risk, market volatility ,and rising interest rates, mainly during the fourth quarter. Real estate had $23.2 billion in net assets under management, up by $2.6 billion from the previous fiscal year and private equity had net assets under management of $19.4 billion, $3.5 billion more than in fiscal year 2017.

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Passive Becomes Mainstream For Retirement Plans

Passive investing has become mainstream for most retirement plans globally, says a CREATE-Research survey. It found 66 per cent of investors see passively managed strategies as “a mature part of their portfolio,” with 16 per cent still in the awareness-raising phase. Among the rest, 15 per cent are in the implementation phase, while the remaining three per cent are close to deciding on passive investments. Passive investments have been implemented via traditional index funds used by 48 per cent of respondents; separate accounts by 38 per cent; and exchange-traded funds by 23 per cent. Eighty per cent of respondents expect to grow their passive investments in the next three years, including 31 per cent that project increasing by more than five per cent. Two major factors are driving passive investing among global institutional investors. Over the past decade, passively managed mandates are on average delivering superior returns net of fees compared with actively managed investments. As well, passive management is experiencing “a strong boost from dramatic upheavals in the investment landscape over the past 18 years.” These upheavals include riskier investments failing to generate returns, actual returns diverging significantly from expected returns, and diversification failing when it was needed the most. However, investors still do see drawbacks with 68 per cent seeing passive investing as “buying yesterday’s winners and overinflating valuations.”

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Geographic Split Over RI

There is a geographic split when it comes to attitudes towards responsible investing (RI), with noticeably more activity in the EU ‒ particularly the UK ‒ than in the U.S. Canada, meanwhile, falls in between – less engaged in RI than the UK and EU, but substantively more active than the U.S., says an Aon survey. For example, 80 per cent of investors in the UK say that climate change is the major RI-related investment concern, followed by 76 per cent of those in the EU and 67 per cent of Canadian investors. In the U.S., while climate change ranked second among investment concerns, it was cited by only 48 per cent of respondents, behind concerns over economic nationalism (56 per cent). Similarly, in the U.S. no investors said that they would withdraw from a fund manager who lacked an RI policy. Five per cent of Canadian respondents and 11 per cent of UK investors would. The Canadian institutional focus on RI extends to investment managers as well, says Calum Mackenzie, a partner, investment consulting, at Aon. “Anecdotally, we see investment committees spending more time dedicated to ESG (environmental, social, and governance) discussions and they are questioning managers vigorously about their ESG policies. That speaks to how important the issue has become to institutions,” he says. Regional variations also show 47 per cent of UK and European investors have an RI policy in place, compared to just 30 per cent of U.S. investors. Investors in Europe were the most likely to have dedicated RI staff (28 per cent). Survey respondents expect Europe to lead the RI charge going forward, but were split on who might come in second. Interestingly, each geography picked themselves as the RI “runner up.” Investors from the U.S. placed themselves as second most important for driving RI forward at 33 per cent, UK investors placed themselves firmly in second at 24 per cent, and investors from Canada placed themselves into the second spot at 23 per cent. The most common type of RI implementation was ESG integration into investment strategies (47 per cent).

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Focus Data Resources Elsewhere

While data scraped from smartphone apps and social media feeds has been promoted as a means to identify investing opportunities and tap into alpha, institutional investors may be better off focusing their data resources elsewhere, says a research paper from Stanford University’s Global Projects Center. ‘Rethinking Alternative Data in Institutional Investment’  suggests that asset allocators such as pensions, endowments, and sovereign wealth funds benefit most from using new data sources to support functions like risk management and operations, rather than the “exploitative” strategies pursued by hedge funds and other asset managers. It says “alpha-oriented, opportunistic” strategies tend to require speedy execution, which most allocators do not have the agility or risk appetite to successfully undertake. What these investors do have, however, are long operating horizons, which give them the ability to be “more methodical and disciplined” than shorter-term investors. This comparative advantage is more aligned with defensive and defensible approaches to alt-data than it is with the exploitative strategies that short-horizon investors tend to pursue. Alternative data can also be used to identify and eliminate internal inefficiencies to improve net returns by cutting extraneous costs. Most investors “already possess large volumes” of alternative data that could be used for this purpose, it says.

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Ricard To Lead iA

Denis Ricard is the incoming president and chief executive officer of iA Financial Group, effective September 1. He takes over the post from Yvon Charest who has announced his retirement after almost 40 years of service with the organization and 18 years in his present role. An actuary by training, Ricard joined iA Financial in 1985. Over the last 33 years, he has assumed positions of increasing responsibility including chief actuary (2004-2010); senior vice-president, business development (2010‑2015); executive vice-president, individual insurance and annuities (2015-2017); and, more recently, chief operating officer (2017-present).

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OPSEU Promises Fight

The executive of the OMERS Pension Plan can expect a fight if they try to rush through unnecessary pension plan changes that will leave members paying more for less, says Warren (Smokey) Thomas, OPSEU’s president. “The OMERS pension plan is in good shape financially and will ensure a dignified retirement for the hundreds of thousands of Ontarians who’ve paid into it throughout their working careers,” says Thomas. “We don’t see any good reason to scale back the size of peoples’ pensions or to increase the amount that people pay in.” Earlier this year, OMERS made a number of recommendations calling for a number of “serious” concessions to be made by the fall.

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Woolverton Joins Foyston

Kimberley Woolverton is senior vice-president, institutional client services, at Foyston, Gordon & Payne Inc. Previously, she was senior business development manager – Canada at Aberdeen Asset Management, a firm she joined in 2009 from Burgundy Asset Management.

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Session Looks At Drug Trends

‘Drug Trends & Forecasting: What It Means To You’ will be examined at a Benefits Breakfast Club session. Shawn O’Brien, a principal, business intelligence, at TELUS; Sarah Lussier Hoskyn, senior analyst, regulatory affairs and market access, at Innovative Medicines Canada; Leanne MacFarlane, senior director advocacy and preferred providers, at Sobeys National Pharmacy Network; will review historical drug trends, explore current trends, and dissect trend factors by impact of new therapies versus utilization. It takes place June 22 in Mississauga, ON. For information, visit Drug Trends

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