Canadian Workers Confident With CAPs

Canadian workers who participate in capital accumulation plans (CAPs) such as defined contribution pension plans and group registered retirement savings plans (RRSP) are confident about the state of their finances and say they understand money matters, says Aon’s ‘Global DC and Financial Wellbeing Employee Survey.’ However, many find it hard to save for retirement and are worried about having enough money to retire. The survey found fewer than half of employees have a goal for retirement savings and, depending on other sources of income, many might find their current plan contribution levels are inadequate to ensure their total income needs in retirement. “The good news is that the employees in our survey identified saving for retirement as a top priority and participation rates in workplace retirement plans are high, but we also found that workers are having real challenges being able to afford to save more,” says Rosalind Gilbert, an associate partner in the Aon Vancouver, BC, office. “An even more fundamental issue, however, is the lack of planning and knowledge around retirement savings and income – which is a big call to action for employers who need to do more to educate members, provide access to financial services, and equip them with holistic strategies for retirement readiness.” Employees do say they are interested in receiving more support from their employers in a range of financial areas, including saving for retirement, insurance, and planning.

Yield Curve Signal, Not Harbinger

The brevity and weakness of the yield curve inversion, along with more optimistic outlooks for China and the U.S., are reasons to believe that the inverted yield curve is more a symptom of current central bank policy and less a harbinger of an imminent recession, says a GLC Asset Management Group insight piece on the inverted yield curve. It says an inverted yield curve has frequently been heralded as a predictive signal of an economic recession and stock market downturn. However, there are two big differences in today’s marketplace which it sees as game changers: the cause of the overall low interest rate environment and the degree of credit still flowing within the economy and available to individuals and businesses. This makes the inverted yield curve that occurred late in March not flashing a red signal for equity markets. North American yield curves have been on a steep downward trajectory for over two years, culminating in 10-year bond yields falling below three-month bond yields on March 22 thereby inverting the yield curve. Notably, only a small portion of the yield curve inverted and the inversion was brief. However, this did mark the first inversion of this segment of the yield curve since July 2007. Yield curve inversions do merit attention, it says, as they “intuitively tell us something about economic growth expectations” and because they come at the hands of central bankers, the inversion of the yield curve can shed light on future central bank policy motives.

Mercer’s U.S. DB Pension And Health Admin Business Acquired

Morneau Shepell Inc. will acquire the stand-alone, large market, health and defined benefit pension plan administration business of Mercer in the United States. “This planned acquisition is in line with our strategy to grow our business profitably in the U.S. market and further solidify Morneau Shepell as a leading provider of health and DB plan administration across the United States,” says Stephen Liptrap, president and chief executive officer of Morneau Shepell. Mercer will continue to provide large market health and benefits administration as well as mid-market DB pension administration services when they are bundled with the company’s consulting and brokerage services, including Mercer Marketplace 365 and 365+. Through this acquisition, it expects to gain 73 of Mercer’s large market health and defined benefit pension plan administration clients (1.9 million plan participants) in the United States. Included in the acquisition will be the teams that service these clients.

Alternatives Get New Definitions

New category definitions for alternative funds are now in place. They replace the single blanket ‘alternative strategies’ category, which applied to all alternative funds irrespective of investment mandate or strategy. The Canadian Investment Funds Standards Committee (CIFSC) worked with the Alternative Investment Management Association in Canada to develop categories that recognize the diversity of alternative investment products in the market and allow meaningful comparison of performance between investment fund strategies. The categories are alternative equity focused, alternative credit focused, alternative multi-strategy, alternative market neutral, and alternative other. Efforts will continue to expand the categories further as new funds launch to take advantage of a growing regional alternative investment market.

Association Kicks Off Celiac Campaign

With Canadians suffering from celiac disease going undetected, on average, for 10 to 12 years before receiving a positive diagnosis, the Canadian Celiac Association (CCA) is kicking off its ‘Could it be Celiac?’ campaign to educate patients on the lesser-known symptoms of celiac disease such as anemia, joint pain, bone disease, skin, and reproductive issues. Celiac disease is an autoimmune disorder triggered by the consumption of foods containing gluten (a protein found in wheat, rye, and barley). It can cause years of poor health for those unknowingly living with the condition and puts a financial strain on provincial healthcare systems, as individuals are subjected to years of unnecessary tests and hospital visits. Currently, it affects one in every 100 Canadians, but only 10 to 20 per cent of patients with the disease have been diagnosed. As part of its ‘Celiac Disease Awareness Month’ efforts in May, the CCA will launch two patient-focused reference tools, designed to educate Canadians on the condition and promote early diagnosis. ‘Symptom Quiz’ is a self-assessment questionnaire to help patients start a dialogue with their doctor about celiac disease. Patients can complete the survey and take the results to their doctor. The ‘Growing Up Celiac Workbook’ is a resource guide designed for parents of young children with celiac disease and offers tips on everything from packing school lunches to navigating social situations at school, birthday parties, and sporting events.

Cost-cutting Takes Imagination

In the face of ongoing fee pressure, asset managers in Europe need to think imaginatively and beyond cost cutting, says Cerulli Associates. André Schnurrenberger, its managing director, Europe, says, “Compensation fee models, a focus on broad value-add services that tap different revenue streams, and product innovation are among the options.” There may be additional benefits. For example, compensation schemes for portfolio managers that entail deferrals and clawbacks also help to show trustees that managers are in alignment. Asset managers are innovating by focusing more on outcome-based solutions and using a broader definition of value for their institutional clients. This could include a bespoke index or an investment strategy tailored to regional investment. Some passive managers are doing less for their clients. This has resulted in a new passive-plus bucket, where managers will add services that offer more oversight and control, although investors need to pay extra for these options.

Commitment To Mental Health Should Be In Writing

To build more mental health supports into their workplace wellness programs, employers need to put their commitment in writing, says Linda Lewis-Daly, GoodLife Fitness workplace wellness consultant. While there is no one-size-fits-all approach when it comes to workplace mental health supports, encouraging open communication and offering customizable supports can go a long way to helping employees find help when they need it. For example, a mental wellness policy can outline the organizational outlook on mental health and how it plans to take action to support employees. Leaders can encourage open dialogue by sharing their personal stories and demonstrating their own commitment to mental and physical wellness. With employees often handling their day-to-day tasks while trying to hide their symptoms, opening up more dialogue around mental health issues is the only way to address stigma and normalize mental health conditions.

Furniture Allows Workers To Move

Canadian wellness and lifestyle brand, ergonofis, aims to improve the lives of office workers by shifting the way they work – one desk at a time. The makers of sit-stand adjustable desks and office accessories offer individualized tools that allow modern workers to move a little more and sit a little less. Users have the freedom and flexibility to alternate between standing or sitting, all at the touch of a button. It has also developed a range of design-forward add-ons for any workspace including anti-fatigue mats, monitor and laptop stands, leather mouse pads, power bar outlets ,and casters.

Holinshead Joins iA

Rick Holinshead is vice-president, distribution, group benefits and retirement solutions, at iA Financial Group. He brings more than 35 years of experience in the financial services industry and extensive knowledge of the market to the position. Over the past 30 years, he has held senior management positions at several actuarial consulting firms.

Succession Planning Discussed

When to begin succession planning will be discussed at the ESOP Builders ‘Business Transitions Forum.’ Topics will include preparing senior management for transition and the shift in leadership roles; ensuring the management team is well and independently advised; and strategies for partner buyouts. It takes place May 28 and 29 in Toronto, ON. For information, visit Succession Planning