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June 6, 2019


Amendment Sets Out End Of HTWs

In its 2018 budget, the federal government announced its intention to end the tax treatment afforded to health and welfare trusts (HWTs) for years after 2020 and the introduction of transitional rules to facilitate the discontinuation of HWTs, including the conversion of HWTs into employee life and health trusts (ELHTs), says a Hicks Morley ‘FTR Now.’ While HWTs have long existed as vehicles for providing health and welfare benefits to employees on a tax-effective basis, they have no express legislative framework or authority under the Income Tax Act (ITA). Instead, their rules, including rules respecting contributions and the computation of taxable income, had been set by the Canada Revenue Agency as a matter of administrative policy. To facilitate the conversion of existing HWTs, proposed ITA amendments would, if adopted, allow for HWT property to be transferred to an ELHT at any time prior to January 1, 2021, without triggering taxation. As an exception, however, the proposed ITA amendments would allow HWTs established before February 28, 2018, under which contributions are determined by a collective bargaining agreement, to be deemed as ELHTs on a transitional basis. This deeming rule would apply to a HWT that makes a qualifying election (in a form to be prescribed) and would be continued until the earliest of the next collective bargaining agreement relating to benefits under the trust, the end of 2022, or the date that the trust satisfies the conditions governing ELHTs. HWTs that are not converted or wound up by the end of 2020 will generally be considered employee benefit plans.

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Cost Risks Forcing Write-offs

Climate risks to some of the world’s largest companies could be as much as $1 trillion and be realized within the next five years, says a report by CDP, formerly the Carbon Disclosure Project. Its ‘Global Climate Change Analysis 2018’ says companies reported potentially $250 billion in losses due to the write-offs of assets, but they also calculated opportunities from likely climate business opportunities at $2.1 trillion, with the potential value of sustainable business opportunities almost seven times greater than the cost of realizing them. Financial companies represent a large part, $1.2 trillion, of the potential revenue from low-emissions products and services; followed by companies in the manufacturing, service, fossil fuels, food, beverage, and agriculture industries. The financial services industry also represents the highest concentration of risks, nearly 80 per cent of all financial risk value. More than 80 per cent of the companies expect major climate effects such as extreme weather patterns, rising global temperatures, and increased pricing of greenhouse gas emissions. An estimated $500 billion of costs were rated as likely or virtually certain, with significant risk due to higher operating costs linked to legal and policy changes. The companies also reported as much as $250 billion in losses due to stranded assets such as fossil-fuel assets affected by market shifts to a lower-carbon economy or exposure to the physical effects of climate change.

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Massive Information Distracts Brokers

The massive amount of eMail and information brokers are expected to absorb is their biggest distraction, says Michael Greenwood, of Pelorus. He told the Canadian Group Insurance Brokers’ ‘Benefits, Administration, & Communication ‒ A Broker Panel’ that you can spend hours getting through it and, at the end of the day, not accomplish the goals set for that day. For Allison Brown, of Thorpe Benefits, the biggest distraction is the constant turnover at clients. They just get an administrator understanding their benefits and suddenly they are gone. The turnover is just churning and kind of exhausting, she said. Justin James, of Harry James Group, said the rapid pace of change has created a high wire act deciphering what is noise and what you should be looking at. Compounding this, said Chris Gory, of Insurance Portfolio Financial Services, the industry is seeing benefits advisors becoming ancillary advisors who need to know about all the things in that total compensation package. Cheryl Jones, of Corporate Benefit Consultants, said with everyone texting and sending eMails, they are not getting in front of people anymore. The basics are being ignored and while technology is getting slick, it doesn’t do what brokers need to do which is to listen to people and help them deal with their issues.

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Pension Assets Decline

The market value of assets held by Canadian trusteed pension funds decreased by 1.3 per cent from the third quarter of 2018 to just over $1.87 trillion in the fourth quarter, says Statistics Canada. On a year-over-year basis, the market value of assets rose 1.6 per cent compared with the fourth quarter of 2017. Mortgage investments experienced the strongest growth, up 11.1 per cent from the third quarter of 2018 to $27.4 billion in the fourth quarter. Real estate investments followed, increasing 5.5 per cent over the same period to $201.6 billion. Meanwhile, the value of stock holdings decreased by 5.9 per cent, bringing the total to $536.6 billion. In contrast, the value of bonds increased by 0.4 per cent to $593.9 billion. Pension fund revenues grew 19.3 per cent in the fourth quarter to $50.8 billion. Total revenues from contributions increased by 12.9 per cent to $16.9 billion. Investment income rebounded in the fourth quarter, up 46.6 per cent to $19.4 billion, after declining in the previous quarter. Over 6.2 million Canadian workers belonged to employer-sponsored pension plans in the fourth quarter. Of this group, 5.2 million or 82.7 per cent belonged to pension plans with assets managed by trusteed funds, while the remainder had assets managed by insurance company contracts.

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Strong ETF Inflows Continue

Canadian ETF inflows continue to be strong, with May having the largest monthly inflows so far this year, says National Bank. Canadian ETF net inflows for the month were $4.3 billion, compared to $2.3 billion the previous month. By asset class, Canadian equity ETFs saw $2.6 billion in net inflows, mainly led by broad market ETFs. Among sectors, financial and real estate ETFs had inflows of $29 million and $41 million, respectively, while energy ETFs saw withdrawals of $93 million on the back of falling crude prices. Factor-based ETFs had positive flows across most major categories. The report also says that fixed income flows indicate investors are flocking toward cash in the form of ultra-short-term ETFs and market-uncorrelated long bonds ETFs focused on longer maturity.

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Few Managers Measure Culture

Only a small proportion of asset managers have measured and actively manage their own culture, says a research paper by the Thinking Ahead Institute. ‘The asset manager of tomorrow’ suggests that successful firms recognize that culture is central to the attraction and retention of talent, the motivational forces that inspire strong performance and, ultimately, the creation of value. Roger Urwin, global head of investment content at the institute, says, “We see culture as a big differentiator in determining the successful asset management firms of the future. But perversely, many firms are so hard-wired to the use of precise measurement that they omit culture altogether in their strategy, treating it as a non-controllable item. The dangers of this are particularly apparent when organizations confront growth and disruptive changes as these put even effective cultures into reverse. In these situations, it is only with considerable increases in the leadership energy and focus applied to culture that you can maintain its quality and consistency.” The paper makes the case that diversity and inclusion are derived both from a business case and a cultural case. It describes the business case as enhancing the influence of team members from diverse backgrounds to produce deeper cognitive inputs, wider perspectives, and better informed decisions. It describes the culture case as building a fairer and better culture that helps with motivation and well-being.

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Firms Study Social And Human Capital

Two Canadian firms have studied different aspects of social and human capital as part of a project led by the Prince’s Accounting for Sustainability Project (A4S) in partnership with CPA Canada. Brookfield Asset Management measured the value of its workforce, while the Co-operators Group assessed the financial implications of poor mental health to their business. Brookfield found that the value of the human capital in its asset management business represents almost 60 per cent of its market capitalization, reinforcing the importance of its human capital as a competitive advantage. Further to this, the company found that the value of its approximately 1,700 asset management employees was approximately twice the value of their cost. By undertaking the study, Brookfield has evaluated how to strengthen the links between departments and focus on retaining talent. However, Brian Lawson, its CFO, has a longer-term perspective when talking about the project, saying, “The reality is that the ongoing discussion will be most important. A deeper understanding of the value of our human capital and the way each team impacts value creation will drive our success.” Co-operators Group asked its finance team to look into the company’s approach to mental health in the workplace. Taking the results of the study, the finance team created a business case to recommend and implement substantial improvements to mental health benefits for employees. The financial analysis forecasted an increased return on the investment they are putting into their workforce. “As finance professionals, we know that we need to measure outputs and outcomes in order to improve the management of our business,” says Karen Higgins, CFO of the Co-operators Group. “Mental health is no different.”

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Managers Embrace 401(k)s

The U.S. asset management industry has “wholeheartedly embraced the 401(k) plan as the vehicle of choice for its own employees” says an analysis of the retirement plans investment managers offer their own employees by Greg Allen, CEO and chief research officer at Callan, and Matt Loster, a vice-president in its measurement development group. ‘The Cobbler’s Shoes: How Asset Managers Run Their Own 401(k) Plans’ shows investment management firms scored “extremely well” on the metric of average participant balances as compared with the broad population of 401(k) plans. The data shows the average balance in manager-sponsored plans was $179,171 as of the end of 2016. This was more than four times the average of $42,394 for average plans. “This trend begs the question as to whether investment manager-sponsored plans as a subgroup might be able to provide some useful insights on plan design and implementation,” say Loster and Allen. The prevailing philosophy for the asset management industry seems to be that its participants are sophisticated investors and should be given a broad universe of choices. This is reflected by the fact that, in the sample of 157 asset manager-sponsored plans, the median number of investment options was 39, while the mean was 43. However, investment managers are grappling with the question of whether it is appropriate to use an investment menu that is mainly or exclusively populated with proprietary products.

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LifeSpeak Offers Mobile App

LifeSpeak, an employee digital wellness solution with clients across North America, has launched the LifeSpeak mobile app to deliver its expert-led content covering topics from mental health and financial well-being to marital relationships and eldercare. Free for its clients, their employees, and their family members, the app provides access to all programming while also enabling users to download videos for offline viewing, stream podcasts, participate in live ‘Ask the Expert’ webchats, and manage their account, right from their phone. Activity on the app is 100 per cent confidential and users are motivated to increase their participation and receive lasting health benefits through gamification.

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bcIMC Invests In BMS

Affiliates of the British Columbia Investment Management Corporation (bcIMC) and Preservation Capital Partners have invested in BMS. The BMS management team, led by chief executive officer Nick Cook, will all remain in their current roles following completion and management and staff of BMS will remain significant shareholders in the company. BMS is an independent specialty lines focused insurance brokers in the London, UK, market.

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Sullivan Provides Support

Patrick Sullivan will provide support and lead the execution of the growing number of product marketing deliverables for the product management and analytics team at Picton Mahoney. He will help position the firm as a leader in the institutional investment landscape.

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Macoun Shares Insights

Jeff Macoun, president and COO at Canada Life, will share where he sees the benefit industry at CPBI Pacific’s Unscripted.’ He will explain how this prominent benefits provider expects to compete and what is or could be the next development to disrupt the Canadian benefits industry It takes place October 9 in Vancouver, BC. For information, visit Macoun Unscripted

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June 5, 2019


Digital Tools Used To Communicate

Asset managers are increasingly making use of digital tools to better communicate, says Cerulli Associates. Spurred by regulatory pressure, technological advances, and demographic trends, firms are having to invest more resources and effort into communicating with clients, it says. However, achieving a balance between transparency and compliance is proving difficult. Traditionally, asset managers have had little direct relationship with those whose money they invested. Instead, the chain of distribution enabled fund firms to conduct their relationships with end investors through wealth managers, brokers, discretionary investment managers, platforms, and financial advisors, among others. Those elements remain largely in place, but other dynamics have changed. Fund firms now operate in a climate in which regulators and investors are demanding greater transparency and clearer information, while active managers are under pressure to justify fees in the face of increasing competition from passive managers and non-traditional competitors. “With the needs and demands of investors evolving and advances in digital technology opening new possibilities around communication and engagement, the need for firms to differentiate their brands has become more significant and challenging,” says André Schnurrenberger, managing director, Europe at Cerulli. “This has taken on an extra urgency as younger investors increasingly handle their own affairs through broker platforms and robo-advisors.”

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Global Standards Product Released

Sustainalytics has released its global standards screening product and its global standards engagement service. This marks the first harmonization of best in class products and services resulting from Sustainalytics’ January 2019 acquisition of GES International, a global provider of engagement, screening, and fiduciary voting services to institutional investors. With Sustainalytics’ global standards screening product, investors can screen on over 20,000 companies that might be involved in serious incidents and assess their impact on stakeholders and the environment as it relates to internationally accepted norms and standards. According to industry sources, $4.7 trillion in responsible investment assets are managed according to and aligned with norms-based screening processes.

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Mobile App Earns Bronze

iA Financial Group’s mobile app has won bronze in the digital media – apps and tools category at the Financial Communications Society (FCS) portfolio awards. This competition recognizes the marketing and communications work done in the financial services sector in the U.S. and Canada during the year. The functionalities offered to group savings and retirement plan members were evaluated by a panel of specialists, who chose the app mainly because of the commitment it generates among plan members, particularly in terms of retirement planning.

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CBRE Caledon Bidding For Ferry Operator

Finland’s CapMan Infra has teamed up with CBRE Caledon to bid for the Norwegian ferry operator Norled, a deal that would be CapMan’s first transport investment, say sources. News of the tie-up follows the submission of first round bids for Norled last month and ahead of the submission of binding bids in the middle of next month. It was not clear if CapMan and CBRE Caledon submitted a first round bid or joined the process later. CapMan Infra was set up by CapMan, which also invests in private equity and real estate, in 2017 to target Scandinavian transport, energy, and telecoms deals. Investments it has made so far include Finnish electricity grid and district heating business Elenia and the Överturingen wind farm in Sweden.

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FBMI Joins Navacord

Future Benefits Management Inc. (FBMI) has joined Navacord Corp. ’s JDIMI Consulting, its broker partner dedicated to group benefits and retirement consulting. The move will further deepen Navacord’s specialization across broker partners enabling a more robust service offering to clients. Navacord was created in 2014 as a commercial broker in Canada offering clients a holistic solution that addresses business, personal, and employee needs.

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Lespérance Has New Role

Stéphane Lespérance is president of commercial risk and health solutions in Canada for Aon plc. He will be responsible for the day-to-day leadership of the commercial risk and health solutions teams in Canada. He has been with the firm for 18 years and has held several management roles, most recently serving as executive vice president, eastern Canada.

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Cutting Red Tape Examined

The Private Capital Markets 2019 Conference will look at ‘Cutting Red Tape & Growing Capital Formation.’ It takes place June 12 in Toronto, ON. For information, visit Cutting Red Tape

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June 4, 2019


VPLAs Need Broad Access

As the federal government considers the detailed drafting of the variable payment life annuities (VPLAs) provisions set out in the budget, the Pension Investment Association of Canada (PIAC) encourages it to facilitate the broadest possible potential access for Canadian savers. In its comments on the 2019 Federal Budget, it says it welcomes the defined contribution pension plan decumulation enhancements proposed. Changes to the Income Tax Act which will facilitate the use of advanced life deferred annuities (ALDAs) and VPLAs within registered accounts will over time represent significant enhancements in the decumulation options for Canadian retirees saving outside of traditional defined benefit plans. Its view is that large DC plan sponsors will have the scale to integrate VPLA structures into their registered plan offerings if they so choose, but that smaller employers will likely look to direct their members to third-party providers of such products. Under the current budget language, the only alternative to in-plan VPLA available to those smaller employers would be a VPLA offered through a pooled registered pension plan (PRPP). This may create a significant barrier to accessibility as Canada has not yet seen meaningful traction in the development of the PRPP market. While the PRPP model is relatively new, the introduction of the VPLA may serve as an opportunity for the federal government to revisit the PRPP framework with industry to determine whether there are potential changes that would be encourage broader adoption, it says.

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SIPP Requires Target Asset Allocation

The new funding rules Ontario (PBA) require that all Statement of Investment Policies and Procedures (SIPP) (except certain jointly sponsored pension plans) identify a target asset allocation for assets in respect of defined benefits for every asset class specified in the regulations under the PBA, says a Blakes’ ‘Pensions, Benefits & Executive Compensation Bulletin.’ The new rules necessitate changes to certain plan-related documents, including the pension plan text, annual and biennial member statements, and the SIPP. If a SIPP does not already include a target asset allocation for each prescribed asset class, then it must be amended. FSCO guidance indicates that this must be done as soon as practical, but in any event, the SIPP must contain required asset allocation information on or before the valuation date of a report based on that information. The new funding rules also provide that a DB pension plan text must set out the obligation of the employer (and members, in the context of a jointly sponsored pension plan) to contribute in respect of the Provision for Adverse Deviation (PfAD) in respect of the normal cost, any additional going concern liabilities associated with a benefit improvement, and any reduced solvency deficiency under the plan. As well, the new funding rules also provide for additional disclosure to members, former members, and retired members. The first annual or biennial statements for a DB plan issued after an actuarial report with a valuation date on or after December 31, 2017, is filed must include new information, including a description of the new funding rules. These statements must include an estimated transfer ratio for the pension plan up to the end of the period covered by the statement. FSCO guidance indicates that plan administrators must include the new disclosure requirements with respect to the estimated transfer ratio in statements (both annual and biennial) issued on or after January 1, 2019, even in respect of a statement for a plan year ending in 2018.

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Geopolitical Tensions Harder To Manage

More than any other megatrend, geopolitical tensions will become harder, or significantly harder, to manage over the next three years, says Willis Towers Watson’s geopolitical risk report – ‘Understanding the external threats to an organisation.’ Done in conjunction with the risk association, Airmic, it says these risks ‒ emanating from the interaction between geography, policy, and the economy – are at the forefront of global risks facing today’s businesses. Alastair Swift, head of corporate risk and broking, says, “With geopolitical uncertainty such as Brexit, the U.S./China trade tensions, and now growing concerns over Iran dominating news headlines around the world, there is an expectation that things could get worse before they get better. Geopolitical risk is clearly top of mind in the boardroom.

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OCIO Clients Seeking More Alternatives

Outsourced chief investment officer (OCIO) clients are increasingly seeking alternative investments to diversify their portfolios and to obtain higher returns than those currently available from public investments, says research from Cerulli Associates. OCIO providers indicate that they expect allocations to alternative asset classes to grow for nearly all institutional client types while equity allocations are trimmed. They anticipate changes to private investment allocations including real estate, infrastructure, and private debt. One explanation behind this expected shift is investors’ concern about the possibility of a future market downturn. “Providers and asset owners are paying close attention to portfolio diversification and the low correlation of many alternative asset classes to public investments, particularly equities,” says Laura Levesque, senior analyst at Cerulli. “The current capital market environment is also a reason for these expected allocation changes. As persistent single-digit equity returns and relatively low interest rates make it challenging for investors to reach target returns using only public investment opportunities, clients seek private investments in an effort to close the gap.”

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Small Firms Get Benefits Quoting

PaymentEvolution is offering a real-time quoting service for employee benefits. Working with Empire Life and other insurers, its quoting tool now makes obtaining health and dental plans feasible for small employers. In 2018, its small business survey found that 79 per cent of Canadian small businesses do not provide any health, dental, or other types of insurance benefits to their staff, citing the lengthy and confusing buying process as the reason. With the help of Canada’s top insurance companies, this application works with brokers and business owners to get quotes out quickly.

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Caisse Sells Capital Vision

West Street Capital Partners VII, a fund managed by the Merchant Banking Division of Goldman Sachs, will acquire Capital Vision Services, LP from Altas Partners and the Caisse de dépôt et placement du Québec. CVS, which provides management services to MyEyeDr. O.D.’s optometry practices, supports affiliated independent MyEyeDr. optometrists and their practices with financial, marketing, human resources, and accounting services, along with managed care credentialing and claims processing.

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Hersh Joins Mercer

Steve Hersh is workday financials practice leader for Mercer digital in the U.S. and Canada. He will oversee the overall development of the practices offering. Previously, he was principal managing partner at Workday where he managed a select portfolio of strategic customers and oversaw the growth of its financial services solution.

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ISCEBS Offer Social

The Toronto Chapter of the International Society of Certified Employee Benefits Specialist is inviting chapter members, CEBS students, and benefits professionals to its annual social. The event allows attendees to socialize and network. It takes place June 6 in Toronto, ON. For information or to RSVP, eMail, with ‘ISCEBS Toronto Social’  in the subject line, ‘iscebstorontochapter@gmail.com

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June 3, 2019


BC Makes Biosimilars Mandatory

British Columbia has become the first public payer to implement a mandatory switching policy that is expected to dramatically increase the use of biosimilars in the province, says the Telus ‘Health Benefits Hub.’ PharmaCare recipients who are currently taking originator biologics Remicade, Enbrel, and Lantus have until November 25 to switch to a biosimilar. After that date, PharmaCare will no longer cover the originator drugs (although exceptions may be made on a case-by-case basis). B.C. predicts it will save approximately $100 million in the first three years and has stated it will reinvest the savings to cover new drugs. It has already added two drugs to its formulary: Jardiance (empagliflozin) for diabetes and Taltz (ixekizumab) for psoriatic arthritis. “BC is following an example set by a number of governments in Europe and elsewhere in the world. I expect that other provinces will eventually follow suit,” says Mark Jackson, consultant pharmacist at TELUS Health. As a Pharmacare province, BC may also have set the wheels in motion for private drug plans to adopt a switching policy.

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CLHIA Withdraws Guideline

The Canadian Life and Health Insurance Association (CLHIA) has withdrawn Guideline G19 on advisor compensation for group benefits and group retirement services. “Following extensive discussions with market players, including advisors and their associations, and careful consideration of what we heard, we have decided to withdraw this industry guideline,” says Stephen Frank, CLHIA’s president and CEO. “Our industry is still strongly in favour of market transparency and plans to work closely with regulators and other stakeholders on these matters going forward.” As a result, measures related to group retirement services sales that were to begin for new contracts on July 1 and annual disclosure for existing contracts on January 1, 2020 ,will not proceed. Similarly, disclosure measures for group benefits sales, which were to begin on January 1, 2020, for new contracts and January 1, 2021, for existing contracts, will not proceed.

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RIA Increasing Advocacy Work

The Responsible Investment Association (RIA) plans to increase its advocacy work in the coming year. This one of five strategic priorities for achieving the RIA’s overarching goal of driving the adoption of responsible investing (RI) in Canada’s retail and institutional markets updated in its 2018 annual report. Canada’s RI market has doubled in size over the last four years, reaching a tipping point in 2018 when, for the first time ever, RI assets surpassed 50 per cent of all professionally-managed assets in Canada. Within the context of this growing market, the RIA has also grown on all fronts, doubling its membership and tripling its staff capacity in the last four years. This has enabled it to expand its programs and events while solidifying its position as the national hub for RI in Canada. In terms of advocacy work, last year, it participated in the Canadian Securities Administrators’ (CSA) consultation on proposed client-focused reforms. Those reforms would embed ‘best interest’ principles in several existing CSA rules, such as ‘know your client’ (KYC). It advocated for bolstering KYC requirements to include collecting information on clients’ environmental, social, and governance (ESG) preferences. It will also be forming a ‘policy advisory council’ to help the group with other advocacy opportunities. Alongside increased policy work, it will increase its outreach to asset owners and investment consultants to further drive the adoption of RI in Canada’s institutional market. “I believe the investment industry is entering a new era. The rise of responsible investing is not a trend; it’s a paradigm shift,” says Dustyn Lanz, its CEO.

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Investor Confidence Rises

Global investor confidence rose to 79.5 points during May, up 6.6 points from April, yet overall sentiment towards markets remained low, says the State Street ‘Investor Confidence Index.’ While European and North American investor confidence increased to 76.7 and 92.5 points respectively, in Asia it dropped by 4.2 points to 88.4. “Trade war and Brexit-related uncertainty dominated this month’s headlines. Institutional investors have been wary and with potential supply-chain disruptions and concerns about rising protectionism it is understandable that sentiment remains anchored in the risk-averse territory,” says Kenneth Froot, one of the report’s authors. However, while the low level of the index points to risk-off behaviour over the last few months, the solid uptick this month indicates some investors may be moving back in to buy the dip.”

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Teachers’ Appoints Directors

Maggie Fanari is managing director, Teachers’ innovation platform (TIP) and high conviction equities (HCE), at the Ontario Teachers’ Pension Plan. She joined Ontario Teachers’ in 2006 and has structured and executed on large-scale, partnership driven minority investments in both public and private companies in multiple sectors around the world. Kevin Mansfield is managing director, consumer and retail. He joined Ontario Teachers’ in 2005 and has nearly two decades of private equity experience. Blake Sumler is managing director, industrials. He joined Ontario Teachers’ in 2013 and has worked in private equity for more than 15 years. Ashvin Malkani is managing director, technology, media, and telecommunications. He joined Ontario Teachers’ in 2002 and has nearly 20 years of private equity investing experience. Jeff Markusson is managing director, financial services. He joined Ontario Teachers’ in 2006 and has participated in a number of investments across the industrial, business services, and financial services sectors. Terry Woodward is managing director, healthcare. He joined Ontario Teachers’ in 2001 and has worked on dozens of investments and funds in venture capital, growth equity, and private equity.

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CFA Looks At PfAD

The CFA Society Toronto will examine ‘PfAD ‒ New Funding Rules for Ontario Pension Plans – Are You Prepared?’ The session will give attendees a better understanding of the new rules for Ontario single-employer pension plans. This includes changes to solvency funding rules, the introduction of new funding provision for adverse deviations (PfAD) and their implication on additional funding, and the required disclosure. Topics include the impact on investment allocations, solvency and going concern funding, implementation challenges, and what may change in the future. It takes place June13 in Toronto, ON. For information, visit PfAD

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May 31, 2019


Climate Change Missing From Policies

The UK Association of Member Nominated Trustees has found that few money managers in the UK, Europe ,and the U.S. publicly state voting policies and guidelines on climate change, gender, and ethnic diversity. Its report found that half do not have a climate change-related voting policy or guideline on their voting policies. Only 25 per cent of the managers that published their policies had voting guidelines on excessive remuneration of investee companies’ top executives. Also, more than 30 per cent of the managers made no reference to gender diversity on boards and nearly 75 per cent of them did not mention ethnicity with regard to board diversity in their policies. As new mandates from the UK and the European Union’s regulators are coming into effect this year requiring investors and managers to disclose and report on their ESG and pay voting policies. The association has launched a formal complaint to the UK Financial Conduct Authority asking it to further investigate the issue and propose remedies. It is calling for minimum standards for voting policies and practices, including a provision that managers be required to accept client voting policies to allow them to fulfill their regulatory obligations.

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BC Offers New Unpaid Leave

British Columbia has introduced new critical illness or injury leave and domestic violence leave, says Eckler ‘GroupNews.’ Bill 8, the Employment Standards Amendment Act, 2019 (Bill 8) makes eligible for up to 36 weeks of unpaid leave to provide care or support to family members under the age of 19 and up to 16 weeks of unpaid leave for family members 19 years old or older who are diagnosed with a critical illness or injury. Employees must provide a certificate from a medical practitioner or nurse practitioner before commencing the leave. It also introduces additional leave provisions for victims of domestic violence. If an employee experiences domestic violence, they are entitled to request up to 10 days of unpaid leave to seek medical attention, obtain victim or social services, obtain psychological or other professional counseling, seek legal or law enforcement assistance, or temporarily or permanently relocate. Employees may also request an additional 15 weeks of unpaid leave time. These changes mean employers and plan sponsors will need to review their current policies and procedures to identify and make changes necessary to comply with the new legislation.

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Lanz Joins Gender Balance Group

Dustyn Lanz, CEO of the Responsible Investment Association (RIA), has become a member of the 30% Club Canada, a group of business leaders committed to working towards a gender balance in corporate leadership. The name comes from its aspirational goal, which is for women to hold 30 per cent of board seats and C-Suite positions. Recent research from Osler shows that women hold only 3.3 per cent of CEO positions and 16 per cent of board seats at TSX-listed companies. As a member of the club, Lanz will actively contribute to its goal of achieving better gender balance on boards of directors and in senior management positions. “The severe gender imbalance in corporate leadership is unjust and it paints a stark picture of how far we have to go on gender equality,” he says. A diverse board is associated with improved governance and board performance, as well as strong financial performance for companies and shareholders.

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Chinese Economy To Take Flight

A positive turn in both the U.S. and Chinese economies will likely prolong the global economic cycle, making the recent ‘inverted yield curve’ signal a false alarm, or at the very least, too premature to warrant a near-term change in investment strategy, says Brent Joyce, chief investment strategist at GLC Asset Management. Writing in its ‘Insights,’ he says the Chinese economy will once again take flight this year and for the third time since 2009, a rebounding Chinese economy will reinvigorate global growth and trade and lift equity markets and bond yields. Every global expansion since the financial crisis has come in concert with a reflating Chinese economy, he says. With North America, Europe, and Japan all showing signs of slowing, the timing couldn’t be better for China’s economy to exit its slowdown sooner rather than later, although he doesn’t expect the timing to line up conveniently and 2019 may be subject to bouts of fear that the global economy is slowing. As well, with the U.S. Fed on hold, and bond yields retreating to 18-month lows, U.S. market headwinds are now becoming tailwinds. Unfortunately, these policies take time to work their magic on the economy and markets, during which time a détente or deal between the U.S. and China on trade would also help to reignite economic growth.

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Few Commonalities Found In Global Disability Management

Disability management is complicated with few commonalities from country to country, says research from the Cowan Insurance Group. It surveyed its global partners in 16 countries to compile a report on disability management practices across the globe, based on local disability insurance legislation and standard industry practices. ‘Disability Management: A Global Perspective’ says that ensuring disability programs are compliant with government legislation and local norms are imperative. However, it’s also essential to consider the individual needs of clients and their most valuable assets ‒ their employees. To meet the needs of its clients with offices and employees in other countries with global benefits needs, it turns to its strategic partnerships with organizations such as Asinta to deliver solutions for its clients.

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Clearpool Comes To Canada

Clearpool Group, a provider of holistic electronic trading solutions and an independent agency broker-dealer, has launched its Canadian product offering. With this launch, the company has introduced functionality to support Canadian equities trading and inter-listed securities trading via its algorithmic management system (AMS), which includes a suite of fully configurable algorithms and smart routers. The follows the announcement of a strategic partnership with BMO which utilizes its technology for its institutional clients. It has also opened its Canadian broker-dealer, Clearpool Execution Services (Canada) Limited, and become a member in the Investment Industry Regulatory Organization of Canada (IIROC). Expansion into Canada is part of its global commitment to develop electronic trading solutions with a focus on the transparency needed to promote fair and equitable markets.

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MAVIRET Added To New Brunswick Formulary

AbbVie’s MAVIRET (glecaprevir/pibrentasvir tablets) is now listed on the New Brunswick Drug Plans Formulary. It is a once-daily ribavirin-free treatment for adults with chronic hepatitis C virus (HCV) infection across all major HCV genotypes (GT1-6). It is an eight-week, pan-genotypic treatment for patients without cirrhosis and who are new to treatment.

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De Roy Joins IMCO

Patrick De Roy is senior managing director, total portfolio and capital markets, at the Investment Management Corporation of Ontario (IMCO). With over 20 years of experience as a portfolio manager and investment advisor, he was most recently head of global research at the Caisse de dépôt et placement du Québec. Prior to that, he was a partner and investment practice leader at Eckler Ltd.

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Pharmacare Options Explored

The CPBI Southern Alberta Region will look at ‘Exploring Pharmacare Options: A Critical Analysis’ with Warren Xu, public policy analyst at GlaxoSmithKline. He will summarize some of the pharmacare options and assess each according to four pharmacare principals. It takes place June 13 in Calgary, AB. For more information visit: Pharmacare Options

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