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September 3, 2021

FUNDED POSITION OF PLANS IMPROVES

Over the month of August, the funded position of an average pension plan improved slightly on both the solvency and accounting basis, says the ‘Pension Indices’ report by LifeWorks for August. Investment returns were 1.2 per cent for the month for a representative pension plan portfolio. In general, returns on equities were positive, while returns on bonds were slightly negative. Long-term Government of Canada bond yields increased by about three basis points in August. Corporate bond yields also slightly increased for long-term maturities, which led to a slightly lower value being placed on accounting liabilities for pension plans. The accounting pension expense index continues to register a significant fall in next year’s anticipated pension expense compared to the start of the year. Accounting and solvency funding levels have improved by about 10 per cent and nine per cent respectively compared to December 31, 2020.

September 3, 2021

CORONA CATALYST FOR ESG

The coronavirus pandemic has acted as a catalyst for the adoption of environmental, social, and governance (ESG) investing and thematic investment more broadly, says Cerulli Associates. In ‘Global Markets 2021: Continued Growth in Uncertain Times,’ it submits that although the growth of ESG investing means additional regulation and the need for different skill sets, it is creating new opportunities in terms of both products and markets. “We expect the spread of ESG investing to continue around the world to varying degrees,” says André Schnurrenberger, managing director, Europe, at Cerulli Associates. “Over the past year, we have seen two key trends in this area. One is that both retail and institutional investors are showing increasing demand for sustainability; the other is that responsible investment products have outperformed consistently, even in the face of significant challenges.” Deeper scrutiny of ESG processes, it is becoming more firmly entrenched among U.S. institutional investors and there has been broader progress in the country’s retail investor and retirement segments. Asset owners place high importance on asset managers having an articulated mission and a culture in which gender and racial diversity and inclusion (D&I) is central. Allocators are digging deeper into firms’ D&I policies, requesting greater transparency in pay equity, profit sharing, and equity ownership.

September 3, 2021

BGO ACHIEVES OCCUPANT HEALTH CERTIFICATION

BentallGreenOak (BGO) has achieved ‘Fitwel Viral Response Certification’ with distinction for 50 of its office and retail assets, representing the largest portfolio of commercial real estate properties in Canada to achieve the certification. This achievement brings the Center for Active Design’s (CfAD) Fitwel Viral Response Module (VRM) standard to BGO’s managed portfolio across Canada, including the first buildings to achieve this standard in Montreal, QC; Winnipeg, MB; Mississauga, ON; and Gatineau, QC. Third party certification of BGO properties’ operations, policies, and practices confirms their preparedness to mitigate the spread of infectious disease and safeguard occupant health and wellness.

September 3, 2021

RECORD ASSETS FLOW TO ESG ETFS

July saw record assets and net inflows in ESG (environmental, social, and governance) ETFs world-wide, says ETFGI. Assets reached US$309 billion with net inflows of US$14.93 billion during the month, bringing year-to-date net inflows to a record US$97.38 billion, compared to US$37.18 billion gathered at this point last year and US$8 billion more than the US$89.07 billion gathered in all of 2020. Total assets invested in ESG ETFs and ETPs increased by 5.8 per cent.

September 3, 2021

TANG JOINS TTCPP

Anthony Tang (CFA) is a portfolio manager, public market investments, for the Toronto Transit Commission Pension Plan (TTCPP). He has over 14 years of professional experience, most recently at Mercer in their delegated solutions business (OCIO).

September 3, 2021

COMMUTED VALUE INTEREST RATE ASSUMPTIONS

The interest assumptions required to calculate commuted values and marriage breakdown values for an event which occurs in any month up to and including September 2021 are now available at www.an-actual-actuary.com. An Excel spreadsheet on the website includes the following worksheets:

  • Current CV Rates December 2020 CIA

  • Current Marital Values January 2012

  • Current Annuity Proxy

  • Current Interest on Contributions

  • Historical Ontario (Bill 133) Prior Rates

  • Historical CV Rates December 2020