Contingent Plans Need Regulatory Focus On Sustainability
A lack of regulatory focus on sustainability is making it an issue for pension plans with contingent benefits, says Barbara Sanders, associate professor in the department of statistics and actuarial science at Simon Fraser University. She and Barry Gros, non-voting chair of the University of British Columbia Staff Pension Plans board, outlined their research findings on sustainability of these plans ‒ which include multi-employer pension plans, shared risk plans, and target benefits plans ‒ in ‘The Quest for Sustainability in Pension Plans with Contingent Benefits’ at the ‘2019 ACPM National Conference.’ She said concerns about plan sustainability are a recent development. It was not until 2008 that it became a hot topic when plans turned their attention to risk. However, most plans use the term the sustainability without defining it although there are similarities in their interpretation including affordability, benefit security, and looking at the long term. It is also more than financial components. It also includes governance, plan design, and communication as key contributors to sustainability. Gros said design and the nature of a plan play a role in sustainability, working together with financial management. This means plans need to be simple, focus on certain future benefits, incorporate things important to members, keep contributions within the ability and willingness of participants to pay; and with resilience built in by maximizing the plan’s ability to manage adverse circumstances. However, a key issue is a lack of regulatory focus on sustainability. For Sanders, what must be avoided is trying to lay long-term goals of plans on short term regulation. Policy-makers need to make a choice on where the focus should be. She suggests a principles based approach which gives plans the ability to align financial management with their long-term sustainability goals. Gros noted this is important because the goals of these are different than those of traditional defined benefit plans. However, more research is needed in this area to determine what works and the existing practices of successful plans.
We Can Create New Mental Health Paradigm
Mental health illnesses remain a burden on the economy and to employers, but we can create a new paradigm, says Dr. Richard Heinzl, global medical director at WorldCare International, Inc. Speaking at the Benefits and Pensions Monitor Meetings & Events session, ‘Benefit Trends & Insights,’ he said the cost to the Canadian economy is estimated at $51 billion, with $20 billion from workplace losses. “Half of the sick days taken in the workplace are due to mental illnesses.” As well, mental health illness claims are among the fastest growing disability claim type. In his presentation, ‘Workplace Health and Wellness; A Working Model for Mental Health,’ Heinzl said that while awareness around mental health may be increasing and stigma decreasing, “we haven’t invented too many new things to address this problem. Innovation is badly needed.” Areas that need to be addressed include getting a proper diagnosis and access to treatment, including access to psychiatrists, which currently have a waiting list as long as 24 months in some regions of the country. WorldCare, in partnership with Co-operators, started a pilot study that looks at the most difficult and expensive cases to determine what was lacking. They wanted to empower all stakeholders involved and leverage technology. The focus was to get the claimants back to work with deep engagement and psychiatric guidance. WorldCare has access to 600 specialist psychiatrists and psychologists via Massachusetts General Hospital. Tele-psychiatry was considered a valid approach to make the program accessible across Canada. The study had a profound impact. “We wanted to help a couple of people, but 50 per cent went back to work.” Seventy per cent of participants went back to full-time capabilities, 90 per cent had new treatment recommendations, and 100 per cent had a positive satisfaction rate. Overall, the study showed a strong return on investment with reduced rate of claimants on disability, enhanced productivity, and reduced presenteeism. “We are able to make a difference,” said Heinzl. He said the industry needs a cultural shift and creative approaches.
Medical Benefit Costs Outpace Inflation
Employer-provided medical benefit costs in Canada could rise six per cent in 2020, outpacing general inflation by 1.9 per cent, says Aon’s ‘2020 Global Medical Trend Rates Report.’ The increase for Canada employer-sponsored medical plans expected next year is due to a combination of higher costs from the increased spend for drugs in general, reflecting the many health risk factors facing Canadians today. Several of these risk factors are manageable through a combination of drug therapies and other wellness initiatives and employers are increasingly looking at the bigger picture to determine the approach they want to take to mitigate costs. Globally, costs for employer-sponsored medical plans in 2020 are forecasted to increase eight per cent, up from 7.8 per cent growth this year. This is mainly due to expanded benefits and a slight increase anticipated in general inflation. Projected medical trend rates vary significantly by region. Costs are expected to increase the most in Latin America and Middle East/Africa regions, with average medical premium rates forecasted at 13.1 per cent and 12.2 per cent, respectively. In contrast, Europe is projected to see an average medical premium rate increase of 5.7 per cent.
Plans Of Past No Longer Work
A lot of rethinking of pension plan design is going on because the plan designs of the past aren’t working for those being hired today and are even becoming a barrier to recruitment and talent retention, says Kim Duxbury, executive client partner, group retirement services, at Sun Life Financial. She told the ‘Adapting Retirement Programs To A Diverse Workforce’ session at the ‘2019 ACPM National Conference’ that if a plan is easy to understand, there is a greater chance it will be appreciated and valued by employees. This means effective plans today are moving away from complexity and giving employees more choice on where they can direct their retirement plan contributions. While company contributions and matches are going into the employer pension plans, employees are being allowed to put their contributions into other vehicles like RRSPs and TFSAs. She also said sponsors are stepping back from financial education because it “doesn’t move the needle” and only leads to disappointment.
Machine Learning Is Future In Claims Management
While artificial intelligence (AI) is being used in the group insurance space for member experience and operations, very little is done using AI in claims management with almost all of this work currently being driven by individual plan sponsors, says Scott Campbell, a clinical pharmacist at Cubic Health Inc. In his presentation, ‘Use of Machine Learning & Predictive Analytics in Health Benefits,’ at the Benefits and Pensions Monitor Meetings & Events session, ‘Benefit Trends & Insights,’ he said, companies that don’t integrate machine learning (ML) and broader AI in claims management over the next five years will be left behind. “ML has potential profound implications for our industry from a disability or health management perspective,” he said. Currently, most carriers, plan advisors, and health service providers are stuck in the realm of reporting. And, companies can’t leverage ML and broader AI on a reporting platform. ML needs to sit on an analytics platform. Reporting is the process of organizing data into information summaries in order to monitor how different areas are performing. Analytics is the process of exploring data and reports to extract meaningful insights which can be used to understand and improve performance and facilitate effective decision-making. Analytics answers ‘why’ and ‘so what’ questions through exploring and interpreting data as opposed to just compiling data. With analytics, plan sponsors can, for example, quantify the prevalence and severity of every chronic and acute disease state within a specific plan population. They could then create a predictive analysis based on those results. ML could also take enriched data and enhance assessment of leading indicators for disability and help identify high-risk claimants proactively. Since reporting platforms are not the same as analytics platforms, stakeholders will need to make meaningful investments in tech, infrastructure, and people or look at partnerships.
Canada Exposed To World Trade
Were Canada an island, isolated from the broader global economy, there would be little reason for concern, says the ‘AB Global Economic Outlook September 2019.’ Both growth and inflation are at or near equilibrium and the Bank of Canada would be comfortably on hold. But Canada is not an island, leaving it exposed to the vicissitudes of global trade. With the global backdrop worsening, Canada is unlikely to be spared from the economic downdraft which is expected to intensify in coming quarters. The Bank of Canada can see the storm coming and it seems prepared to cut rates, but not until the bad weather arrives. That could happen later this year and into next, and could signal multiple rate cuts even though the cycle has yet to begin. In the meantime, Canada will continue to watch events, over which it has little influence, unfold and hope that the turmoil isn’t too severe, it says. Globally, the outlook continues to darken. Global growth could slip to 2.3 per cent in 2020, which would be the weakest growth rate since 2009. The two key questions are will manufacturing recover before weakness spreads to investment and jobs, dragging overall growth lower and will the policy response be big enough and effective enough to offset downward pressure on global growth. Of particular concern is the outlook for trade-sensitive economies where there’s limited scope to provide effective policy support. Closed economies should fare better. It has lowered its U.S. forecast only modestly to 1.5 per cent (1.8 per cent previously) and has sufficient confidence in an effective Chinese policy response to leave its China forecast unchanged at six per cent.
Virtual Healthcare Offers Alternative Solution
Insurance carriers are starting to align themselves with virtual healthcare solutions, says Terry Power, chief executive officer of Medisys Health Group Inc. Speaking at the Benefits and Pensions Monitor Meetings & Events session, ‘Benefit Trends & Insights,’ he said plan sponsors should pay attention. In his presentation, ‘Virtual Care: The Solution At Our Fingertips,’ he showed that the Canadian healthcare system is facing tremendous pressures that are likely to grow within the next decade. As much as $16 billion is lost in productivity per year due to absenteeism and presenteeism alone and employers are paying the price. Limited access to healthcare is one of the barriers to good health, so virtual care provides an alternative point of access, he said. However, only nine per cent of Canadian employers offer virtual care as part of their health benefits packages even though 71 per cent of Canadian employees say they would use it if it was provided. A virtual healthcare platform can provide instant connection with healthcare professionals, virtual consults, and 24/7/365 service anywhere in the world, with no appointment needed. It can address common issues such as prescriptions, lab tests, follow-ups, chronic condition management, mental healthcare, and sick notes. “More and more people are seeing the value of virtual healthcare,” said Power. It is important because “connecting patients through technology supports the health and interests of individuals as well as their employers.”
Supporting Gender Diversity Helps Companies
Companies with practices that support greater gender diversity are rated more effective by their employees across a range of topics than those that do not, says an analysis by Willis Towers Watson. Additionally, companies that offer supportive family services and health education programs for women provide better environments for finding work/life balance and managing workloads. It found companies that grant a higher percentage of promotions to women generate more favourable employee views, especially opinions of senior leadership. The advantages are most apparent when at least one-third of promotions go to women. As well, companies with more women among their most-compensated staff have more favourable employee attitudes, especially for opinions of career development. The advantages are most apparent when at least one-third of women are among the top 10 per cent highest compensated executives. Offering family-supporting and health-enriching benefits, such as adoption assistance and women’s health education, are also linked with more favourable views of work/life balance and the ability to manage workloads.
ESG Sustainability Takes Long-term Focus
Sustainability for Suncor Energy is about the long term with a focus on enhancing economic and social benefits while being environmentally responsible, says Kris Frederickson, its manager of sustainability disclosure and stakeholder engagement. In ‘The Growth of Responsible Investing ‒ Integrating ESG in your Investment Strategy’ session at the ‘2019 ACPM National Conference, he said it has goals in a number areas including reducing greenhouse gases, water stewardship, and indigenous relations. It aims to reduce greenhouse gases by 30 per cent by 2030 and intends to do it not by spending and buying carbon credits which he said don’t actually reduce carbon. Water stewardship is another important consideration. Not only is it looking to reduce the use of water in its process, more important it recognizes its shared responsibility with others that use and value water. It is also working to build greater trust and mutual respect with Indigenous people. Not only does it provides jobs to Indigenous people, it invests with them, and its spending with indigenous suppliers is more than the federal government’s. Eli Angel, principal, responsible investing strategy and risk, at the Ontario Teachers’ Pension Plan, said ESG is about corporate behaviour and it has a become a huge part of the investment space. At worst, it has a neutral value, although a growing body of academic evidence shows it has a positive benefit for companies. There are many approaches ‒ ethical, negative screens, responsible investing, and impact investing. The Teachers’ approach is to integrate it through board oversight and executive team accountability. It also has four types of engagement ‒ thematic such as climate change, proxy voting, collaborative, and event driven. However, he also said its approach is constantly evolving and must because things are changing quickly.
Mental Health Treatment Is Employer Issue
Some employers feel mental health treatment is not their issue, but more are realizing they have to do something, says Chris Anderson, president and founder of Medaca Health Group. In his presentation, ‘Five Myths About Workplace Mental Health Treatment,’ at the Benefits and Pensions Monitor Meetings & Events session, ‘Benefit Trends & Insights,’ he said it’s time to look at different solutions and ideas and build them into healthcare strategies. Access to prompt and effective treatment is poor and many employees suffer needlessly, with the resulting impact on the health and productivity of workplaces. Anderson reviewed and debunked several myths about workplace mental health treatment. They include awareness has solved the treatment problem. He said “We need to work beyond awareness to solutions.” Psychiatry and psychotherapy are mutually exclusive. “Let’s work smart and use the right resources for the right employee at the right time,” he said. Telepsychiatry is an inferior option. “Let’s get on board with telemedicine,” he said. Telepsychiatry is effective across multiple age groups and clinical settings and is well adopted by patients and clinicians.” Mental illness has many direct and indirect impacts on employers. Finding access to the right treatment, at the right time, by the right professional has become a fundamental component of employer mental health strategies.
Malo Joins Provident
Michel Malo is chief investment officer at Provident. He will be responsible for investment management of the $9 billion Newfoundland public service pension plan. He has worked in various Canadian and international cities, where he has earned a reputation for his cutting-edge investment strategy and success building and motivating investment teams. Most recently, he was a senior leader in investment strategy as vice-president, investments, for Canadian National’s investment division.
Author Kicks Off HR Conference
Author and social commentator Yassmin Abdel-Magied will kick off the ‘HRPA 2020 Annual Conference and Tradeshow: Power UP HR. Now in its 78th year, the HRPA (Human Resources Professionals Association) annual conference and trade show brings together more than 4,000 HR professionals and business leaders from across North America. Keynote speakers include Terry Hickey, chief analytics officer at CIBC; Brett House, vice-president and deputy chief economist at Scotiabank; Dr. Tomas Chamorro-Premuzic, chief talent scientist at Manpower Group; and Adam Alter, associate professor of marketing and psychology at the NYU Stern School of Business. It takes place January 22 to 24, 2020, in Toronto, ON. For information, visit HR Conference
First Wave Of Baby Boomers Retiring
The real Canadian baby boom started in 1951 and the first wave is now starting to retire, says Dr. Robert L. Brown, professor emeritus at the University of Waterloo. In ‘The Three-Legged Stool: Is It Still standing?’ session at the ‘2019 ACPM National Conference,’ he said this makes the age 65 subset the fastest growing in the population. It also means the old age dependency ratio ‒ the ratio of working age Canadians to retired Canadians ‒ is now starting to take off. It is now exploding and will not level off until 2035. In 1976, there were 7.1 workers for every over 65 Canadian. By 2036, this will be 2.2. This puts more pressure on working Canadians to support an aging population which means higher taxes to maintain programs and lower productivity from an aging labour force. This could mean a lower standard of living. However, this can be mitigated if older workers continue to participate. Older workers are staying in the labour force longer, some because they enjoy their jobs and others because they can’t afford to retire. However, the widening of the C/QPP late and early retirement factors to reflect life expectancy and the removal of the work cessation test so older employees can receive CPP while working, incents Canadians to work longer. Frédéric Létourneau, vice-president, total compensation, at National Bank, said the Canadian retirement system is good as it strikes the right balance between social and competitive aspects. However, there needs to be a focus on bringing symmetry to solvency and accounting rules. Canada needs one pension law, he said. As well, legislation should allow for all types of solutions to let employers offer plans that meet their needs. Frank Wiginton, leader of Eckler’s financial wellness initiative, said while individuals are ultimately responsible for their retirement planning, employers need to work with them to figure how to save for retirement. Canadians struggle with finances, he said. In fact, Canada has the fifth worst debt to household income ratio among developed nations and the savings rate for retirement continues to decline. What needs to be understood is plan members can’t be expected to do it themselves. In many cases, they are struggling with how they are going to get to the end of the month and have no idea where money to save for retirement will come from. They need help to deal with their other financial issues before they will understand pension and retirement savings, he said.
Wellness Programs Geared To Healthy
The average annual healthcare expense savings tied to physical wellness programs is statistically insignificant, says OPOC.us, a strategic planning firm. After years of research, it found most wellness programs don’t work because the incentives are geared to those who are already healthy. For those employees who know they have health challenges, the focus on a single set of numbers or going to a gym is discouraging. People struggling with their weight frequently feel self-conscious going to a gym and a person already struggling with their cholesterol numbers is going to find certain biometrics unattainable. It suggests that a plan that provides incentives for logging food intake, for example, will allow the employees with weight-control issues to take steps to improve their health without making them feel like they are ‘exposed,’ as they might feel at a gym. In addition, it says, the details about reasonable accommodations for people with medical conditions shouldn’t be relegated to the small print; it should be a point of pride that the wellness program is for everybody.
Moving To DC Not Without Challenges
When Telus closed its defined benefit plan for management in 2007, the key considerations in designing a defined contribution plan alternative were to manage costs, what their competitors were doing, ensuring adequate income support to members in retirement, and offering them choice, said Carol Craig, director, benefits and pensions at Telus in the ‘Moving From DB to DC: The Insider Perspective’ at the ‘2019 ACPM National Conference.’ Defined contribution was introduced as an option in 1996 in response to both team members and business needs. However, the move to DC was completed when the defined benefit plans were closed for union members in 2011 following collective bargaining. Today, Telus has four legacy DB plans, two DC plans. The new approach is not without challenges, she said. This include designing communications to meet generational differences, encouraging employee engagement, and assessing retirement outcomes. However, attraction/retention is starting to be huge issue at the senior level. As they start to think about retirement, there are no levers in DC which can be used to retain them. As a result, it is turning to supplemental plans to meet the needs of higher wage earners. David Lawson, vice-president, investment management at Telus, is working on closing its DB plans. It has four legacy plans all with different levels of funding, solvency, and maturity. As well, as active members of these plans retire, the contributions dwindle so they need cash flow and liquidity to meet their benefit payments. The end goal is to exit the plans which starts with reducing the asset liability mismatch. They will then derisk guaranteed benefit enhancement and reduce longevity risk with longevity swaps and buy-in annuities. To reach the finish line, they will offer buy-outs and windups. He said they expect to reach the finish line in 10 to 15 years. Ed Lee, vice-president of Morneau Shepell’s retirement solutions practice, said with closed DB plans maturing, sponsors are looking to derisk by using annuity purchases as part of their risk transfer and exit strategies.
Value Investing Losing Streak Will Continue
Value investing isn’t making a comeback any time soon, say accounting professors from New York University and the University of Calgary. In fact, the strategy may be on a much longer losing streak than many investors realize, say Baruch Lev, of NYU’s Stern School of Business, and Anup Srivastava, of Calgary’s Hasakayne School of Business. Contemporary discussions around value investing often deal with the strategy’s burst of success following the bursting of the dot-com bubble and subsequent underperformance following the 2008 financial crisis. But they argue that, with the exception of the early 2000s, the value strategy has actually been underperforming since the late 1980s.
Retirement Readiness Real Goal
Balancing retirement flexibility with retirement adequacy may require plan redesigns, say David Morton, an actuary and senior director at Willis Towers Watson, and Jean-Grégoire Morand, a total rewards consultant at Normandin Beaudry. In the ‘Capital Accumulation Plans: How To Balance Flexibility With Retirement Adequacy’ session at the ‘2019 ACPM National Conference,’ they outlined what two companies did to achieve. Mercer Celgar, a single line kraft pulp mill in British Columbia, found, for example, 78 per cent of its employees would not be able to retire until they turned 71. To remedy this, the focus was put on retirement readiness. However, employees are not going to do it, the employer must because there are financial incentives to do so. It froze its non-contributory defined benefit plan to new hires and offered a non-contributory defined contribution plan. However, by 2016 it was becoming apparent employees were not retirement ready. Concerned about future costs if a portion of the employee population were not able to retire when they wanted to, it introduced an employer match to encourage more saving and also used auto escalation to encourage employees to receive the maximum employer match for their contributions. While the employees do have option of not contributing anything, he said the same inertia which keeps them from increasing their contributions to get the employer maximum match resulted in only seven of 110 employees opting out of this. For WSP, a professional services firm, the solution was to no longer talk about retirement savings and instead just focus on saving, said Morand. Its savings program had three components ‒ group RRSPs, deferred profit sharing, and complementary savings arrangements like tax-free savings accounts. However, these were not fully integrated with its benefits or employee experience. It wanted to innovate and increase flexibility while addressing employee financial well-being and savings needs. Using Normandin Beaudry’s ‘savings highway,’ it looked at creating a strong emotional footprint aligned will the real financial needs of employees. This meant not talking about retirement. Employees are encouraged to set saving goal like buying a first house or saving for their children’s education. By meeting these kinds of goals, the employee saving experience is simplified and optimized, he said.
PIAC Appreciates Carbon Price Certainty
The Pension Investment Association of Canada (PIAC) broadly supports the call of the ‘Final Report of the Expert Panel on Sustainable Finance, Mobilizing Finance for Sustainable Growth’ for emissions reductions objectives that align with Canada’s commitments to COP 21, complete with industry specific visions and cost benefit analysis of climate adaptation measures. As investors, it says it appreciates the call for policy certainty regarding the projected trajectory of carbon pricing nationally. Considering Canada’s resource- based economy, it supports a role for Canada to establish the country as a global leader in the decarbonization of high emitting sectors, including its electrical grid and to advance clean tech development. It also would support development of eligibility criteria for green bonds and sustainability accreditation standards generally, to promote integrity in the market. It acknowledges that the transition to a climate-smart economy must facilitate industry competitiveness while promoting sustainable outcomes. As long-term institutional investors, PIAC members recognize their fiduciary duty to protect and enhance the value of their clients’ investments. Climate-related systemic risks present cumulative, far-reaching financial risks and opportunities and the possible value creation or erosion can be significant, it says.
Connor Clark & Lunn Partners On Rail Business
Connor, Clark & Lunn Infrastructure has partnered with the management team of Alpenglow Rail LLC to develop and operate a diversified portfolio of rail businesses across North America. Simultaneously, CC&L Infrastructure acquired VIP Rail ULC (VIP Rail), an Alpenglow affiliate, from Stonecourt Capital LP. VIP Rail is a short line rail logistics business that provides critical first and last mile rail transportation and storage solutions to an established, blue chip customer base in the Sarnia, ON area. Founded by a team of railroad executives with experience in the acquisition, operation, development, and growth of North American short line railroads, Alpenglow Rail is positioned to expand its operating model, which is centered on customer service and safety.
Romanow Speaks At Forum
Michele Romanow, of CBC’s Dragons’ Den and co-founder and president of Clearbanc, is a keynote speaker at the ‘AIMA Canada Investor Forum 2019.’ The line-up also includes Bertrand Millot, chief stewardship investing officer at the Caisse de dépôt et placement du Québec (CDPQ). He will address key considerations for long-term investors. Jonathan Hausman, head of global strategic relationships of Ontario Teachers’ Pension Plan will lead the keynote interview with Eileen Murray, co-CEO of Bridgewater Associates. It takes place October 17 and 18 in Toronto, ON. For information, visit Investor Forum
Temperature Change Top Risk
Global temperature change, global trade collapse, and cyber warfare dominate the top three extreme risks that could have a significant impact on economic growth and asset returns, should they happen, says the Thinking Ahead Institute’s (TAI) ‘Extreme risks 2019 report and ranking.’ The 2019 ranking saw global temperature change , which covers scenarios where the planet becomes far less habitable, climb to the top spot. The number two extreme risk is the potential collapse of global trade, driven by the rise of protectionism primarily due to developments in global politics over the past six years. Joining in third place is cyber warfare. As the world has become ever more connected, the risk of the Internet being weaponized has also increased. The ranking for the first time includes biodiversity collapse, abandonment of fiat money, and cyber warfare. Those that have dropped out of the top 15 this year are deflation, insurance crisis, and terrorism. Infrastructure failure, global trade collapse, and currency crisis all rose in the rankings. The extreme risks that are less of a threat than in 2013 include stagnation and resource scarcity. TAI is an outgrowth of Willis Towers Watson Investments’ Thinking Ahead Group.
Consolidation Affects Opportunities
Consolidation within the pension industry is affecting the opportunities available to asset managers, says Cerulli Associates. ‘European Institutional Dynamics 2019: Addressable Opportunities for Asset Management’ shows although consolidation may eventually lead pension schemes to bring more assets in-house, so far no trend for increased insourcing or outsourcing has emerged. Today, managers can help pensions to access niche asset classes where they do not have the expertise or resources to conduct manager search and due diligence internally, it says. For example, in the Netherlands, consolidation has already led to more competition, more fee pressure, and a knock-on effect within fiduciary and asset management that has seen some smaller players forced to leave the market. A similar process is underway in Switzerland and the UK.
CPPIB Invests In Delhivery
The Canada Pension Plan Investment Board (CPPIB) has invested in Delhivery Pvt Ltd, broadening its exposure to the logistics sector in India. Delhivery, one of India’s leading third-party logistics providers, operates in more than 2,000 cities offering a full range of supply chain services. The investment was made through CPPIB’s Fundamental Equities Asia (FEA) Group, which performs fundamental research and invests in quality corporates for the long term throughout Asia.
SEI Makes Changes
Dexton Blackstock is managing director, head of Canadian business development for the institutional group, and John Csaszar is Canadian equity portfolio manager and analyst at SEI Investments Canada Company (SEI Canada). In his new dual role, Csaszar will manage its Canadian equity funds, as well as retain his current manager research duties. Previously, he worked at CIBC Asset Management, where he researched and evaluated Canadian and global investment managers for a range of asset classes. Blackstock will lead business development in Canada, selling its outsourced chief investment officer (OCIO) solution to all institutional investors, including non-profits, corporations, unions, and governments. He joins the firm from BMO Global Asset Management, where he most recently served as director of institutional sales and service.
Choosing Manager Examined
Choosing and monitoring your investment manager will be examined by Pierre Caron, president of Conseil Phialex, at an IRCA workshop. It takes place September 25 in Montreal, QC. For more information visit: Selecting Managers
CPPIB Extends Private Credit Push
The Canada Pension Plan Investment Board is extending a push into private credit to help fill a need for yield made scarce by low interest rates. Its annual report shows it has increased its private debt investments from C$5.1 billion in 2011 to C$32.7 billion at the end of March. Investments in private credit were virtually zero in 2006. It is pushing further into private debt ‒ where borrowers bypass traditional capital markets ‒ to make up for dwindling yields elsewhere. With concerns about a new global economic slowdown causing interest rates to plunge and about $15.6 trillion of global debt paying less than zero, it’s increasingly urgent for portfolio managers to find new sources of returns. CPPIB has also boosted assets in private equity and real estate and is looking further afield for gains, targeting growth in emerging markets and Asia.
Job Fears Linked To Mental Health Problems
One in four Canadian men (28 per cent) fear their job could be at risk if they discussed their mental health at work, says research by Movember. Its figures released ahead of World Suicide Prevention Day today revealed how, despite growing awareness of the male mental health crisis, a third of men said they would be reluctant to open up about their problems in case it had a negative impact on their career. It also found that 42 per cent of men would be worried about colleagues making negative comments behind their backs if they discussed mental health issues at work. A further 33 per cent of men think they could be held back from promotion at work if they mentioned a problem that they were finding it difficult to cope with. The majority of Canadian men are aware of the availability of mental health days in their workplace, with just over half (54 per cent) of employed men saying they would be able to take time off work, if they were struggling with their mental health or other personal issues. However, this research shows that stigma surrounding mental health is still preventing men from talking about their problems and seeking help when they need it.
North America Still Early In ESG Integration
Institutional investors, particularly those in North America, are still in the early stages of integrating ESG investments into their portfolios, says a global study by CoreData Research. Overall, only 37 per cent of institutional investors are considered ESG embedders, with a high degree of corporate engagement and sustainable and impact investing. The majority, 52 per cent, are early stage adopters using a combination of negative screening, positive screening, and investment decision integration. Only 11 per cent of the investors surveyed reported no use of ESG considerations. On a scale of one to 10 created by CoreData to gauge regional levels of engagement with various ESG strategies, Europe had the highest score at 5.1, while North America had the lowest score at 3.6, compared to a global average of 4.2.
MSCI Barra Acquires Carbon Delta
An MSCI Inc. subsidiary, MSCI Barra (Suisse) Sàrl, will acquire Zurich-based environmental fintech and data analytics firm, Carbon Delta AG. Founded in 2015, Carbon Delta is a global leader for climate change scenario analysis. Together, MSCI and Carbon Delta will create an extensive climate risk assessment and reporting offering for the institutional market, providing global investors with solutions to help them better understand the impact of climate change on their investment portfolios and comply with mandatory and voluntary climate risk disclosure initiatives and requirements.
Quigley Joins Fiera
Michael Quigley (CFA, CAIA) is executive vice-president and head of institutional markets at Fiera Capital Corporation. He will lead the team to optimize and implement its institutional distribution strategy, strengthening the institutional distribution function and building on the firm’s success in Canada. Prior to joining the firm, he led Phillips Hager & North’s institutional business development team across Canada.
Race And Mental Health Discussed
‘Race, Mental Health and the Workplace’ will be examined at an Economic Club of Canada, in collaboration with Wellesley Institute, session. A panel of Derek Quashie, a partner in the immigration practices at PwC; Dr. Kwame McKenzie, CEO of the Wellesley Institute; and Karlyn Percil, CEO of KDPM Consulting and founder of the SisterTalk Leadership and Wellness Academy Group; will aim to increase collective awareness about the intersections between racialization, mental health, and workplaces. It takes place September 17 in Toronto, ON. For information, visit Race And Mental Health
Pension Difference To Last 50 Years
A 20 per cent difference in pension savings between men and women in Denmark is set to persist for the next 50 years, says PFA, the country’s largest commercial pension provider. It says the disparity in retirement income savings between the sexes in Denmark was due to the further education decisions made by the majority of each gender. This in turn affected salaries and pension savings. The choice of education is of great economic importance and women today still, to a large extent, choose education with a lower average salary than men. This means they are on their way to lower pay and savings than men, even before they have had their first working day.
Dry Powder Jumps
Alternative investment firms had $387 billion in dry powder as of June 30, up 18 per cent from the same period a year ago, says a report from Fitch Ratings. The increase in dry powder continued amid elevated market multiples and increasing late-cycle behaviour, such as loosening deal terms and structures. “Dry powder continues to reach new levels,” says Dafina Dunmore, director in financial institutions at Fitch Ratings and co-author of the report. “Fundraising remains pretty solid, though it’s down from most recent levels. There are not a lot of opportunities to deploy capital.” Large, global managers with more diversified investment strategies “tended to find pockets of deployment.” The low interest rate environment is also driving increased institutional investor appetite for private equity strategies, as institutions need to reach a certain yield.
EQ Care Offers Virtual Medical Services
EQ Care is embarking on an roadmap initiative with virtual independent medical evaluation service (vIME). Its virtual medical service enables faster access to care and improved healthcare outcomes by reducing wait times and ensuring the patient journey is customized to each patient’s unique circumstances and needs. Plan members can also have prescriptions requisitioned and lab or other diagnostic tests and specialist referrals ordered remotely – all without having to leave their home or office to endure long wait times. EQ Care provides virtual healthcare services to Sun Life group plan sponsors.
Poirier Joins SSQ
François Joseph Poirier is vice-president of business development and partner experience at SSQ Insurance. A 30-year veteran of the insurance industry, he was most recently vice-president of business development at Desjardins Financial Security. He has also been with Mercer, Morneau Shepell, Willis Towers Watson, and Retraite Québec.
CPBI Ontario Looks To 2020
CPBI Ontario will be ‘Looking Towards 2020: The Challenges for a New Decade. Thought leaders including Ali Ghiassi, vice-president of industry affairs and government relations at Canada Life; Karen Millard, a senior director at Willis Towers Watson; Fabrice Morin, executive vice-president, Canadian operations, at the Great-West Life Assurance Company, London Life Insurance Company, and the Canada Life Assurance Company; and Mike Sullivan, adjunct professor at the University of Toronto; will review and discuss changes going into 2020. It takes place November 14 in Toronto, ON. For information, visit Towards 2020