News Story

Composition By-Law Review - 2015

April 20, 2015

The OMERS pension plans are governed by two bodies – the OMERS Sponsors Corporation (SC) and the OMERS Administration Corporation (OAC).  The composition and process for appointments to the Boards are set out in  SC By-Laws: By-Law #4 – SC Composition and By-Law #13 – OAC Composition.  As part of good governance, the SC committed to reviewing these by-laws every three years. 

Therefore, the SC is currently undertaking a review so that any changes would be effective three years after the effective date of the last review.  There are four key elements to the SC’s composition by-laws each of which is described very briefly below.  The SC would welcome input from stakeholders on each of the elements noted.

 

1 - COMPOSITION

The composition of the OMERS Boards was a significant part of the last review.  At that time the SC adopted various principles for the composition of the SC and OAC Boards.  Certain organizations have been given the right to nominate or appointment Directors to the OAC and SC Boards.  The privilege extended generally reflects the number of active members affiliated with the organization, but recognizes practical limitations given the large number of organizations in the OMERS universe.

2 - CHAIRING

In 2013 the SC added an Independent Board Chair (IBC) to the OAC Board with the IBC being appointed by the SC Board, but recruited and recommended for nomination in a joint process with the OAC Board.

For itself, the SC Board has adopted a co-chairing approach which reflects that the pension plan is jointly sponsored by plan members and their employers.  One Co-Chair is selected by employer representatives and the other is selected by the employee representatives.  The Co-Chairs work together to fulfill chairing responsibilities conferred on them by the SC Board.

3 - NOMINATION AND APPOINTMENT PROCESS

SC Directors are appointed to the SC Board at the will of the respective Sponsor Organizations.  This approach enables the SC Board to provide strategic oversight and decision-making on behalf of sponsors, the plan members and their employers. 

In 2013 an enhanced nomination and appointment process was introduced for the OAC Board primarily to build a higher capacity OAC Board recognizing the OAC Board’s fiduciary responsibilities and its role overseeing significant business operations.  The nomination and appointment process is a collaborative effort between the SC, OAC and Sponsor Organizations, with the SC making the final appointment decision.  The SC has been working with Sponsor Organizations, the OAC Board and the IBC, George Cooke, to ensure the process meets expectations and yields the desired results.

4 - TERM LIMITS

In 2013 the SC chose to impose term limits for the OAC Board based on principles of good governance applicable to such an organization and in part to facilitate the transition to a higher capacity OAC Board. 

The SC did not impose term limits for the SC Board given the very different roles and responsibilities of the SC Board and the representative nature of the SC Board.  The SC was of the view that Sponsor Organizations should not be fettered in their choice of Directors and in any event can implicitly impose term limits if they wish.

SUMMARY

Should you find it useful for reference purposes, the composition by-laws are available here and the 2013 news article announcing that the current by-laws were approved and adopted by the SC is available here.

If you wish to make a submission for consideration by the SC, please provide your written comments by May 31, 2015 (see Contact Us).  Any decisions made by the SC will be communicated broadly through regular channels in due course.