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2020 Plan Review Update
The following is a year-end message from Michael Latimer, President & CEO of OMERS Administration Corporation and Deb Preston, CEO, OMERS Sponsors Corporation.
In a few weeks, we will say goodbye to 2015 and greet the new year. We've achieved many milestones throughout the past twelve months, despite working in a challenging external environment with a shifting retirement landscape and continued volatile markets. We wanted to take a moment to wrap up the year by sharing some highlights with you.
OAC CEO Priorities
When I meet with our members, employers and stakeholders, including at our Spring Information Meeting, I highlight two priorities: Aligning Resources and Building Results. Throughout the year, we have taken measures to ensure the right teams are in place. We have invested in capable, experienced professionals with solid track records to allow us to better serve you—our valued members, employers and stakeholders.
Building Results is about the OMERS team meeting and exceeding expectations so that we can continue to provide secure and sustainable pensions, which is our number one priority. Having the right investment strategy is the key to delivering this priority. Our target asset mix is to have 53% of assets invested in public markets and 47% of assets invested in private markets—and we are on target to deliver this in 2015.
A New Strategic Plan
A notable achievement this year has been the development of an approved enterprise-wide Strategy. The Strategy will guide OMERS' journey over the next five years, serving as a roadmap to 2020. Our vision is to make OMERS a leading model for defined benefit pension plan sustainability. This is a significant achievement and the result of a highly-collaborative process which engaged both the Boards and executive teams. We will be launching the Strategy in early 2016.
Markets, financial results & funded position
The economic environment continues to be challenging with weak global growth, low interest rates and market volatility. While OMERS is not immune from these challenges, our diversified approach is working and has helped shield us from some of this volatility.
Most importantly, we remain on track to being fully funded by 2025 and have improved our funded status this year. OMERS will release its 2015 financial results and funded position by the end of February 2016.
OMERS Sponsors Corporation decisions
The OMERS Sponsors Corporation (SC) has not made any contribution rate changes for 2016, in accordance with its funding management strategy.
The SC Board continues to review its board composition by-law, focusing on four key areas: composition, chairing, nomination/appointment process and term limits for SC Board directors. The SC has received considerable input and is seriously considering this feedback to determine the best approach. The review will continue into the first quarter of 2016.
ORPP & CPP
There has been no shortage of pension-related news in the media over the past twelve months. Most significantly are the governments' announcements regarding the Ontario Retirement Pension Plan (ORPP) and the Canada Pension Plan (CPP). The new federal government has confirmed its intent to propose enhancements to the CPP. Changes to the CPP could have an impact on OMERS members, employers and the Plan. We are engaged in analysis and education of the implications of various options that might be pursued by government. In addition, the ORPP continues to be on the table for full implementation by January 1, 2020. While OMERS members are exempt from the ORPP, there will be an impact on non-full-time employees who are not enrolled in the OMERS Plan.
We are actively monitoring these topics and exploring various solutions. We're committed to providing you with updates as new information becomes available.
The year ahead
Looking ahead to 2016, we will continue to prioritize our relationships with members, employers and stakeholders, with many opportunities to speak and meet with you on issues that matter most. We will continue to be dedicated to our priorities and we look forward to seeing you at our Spring Information Meeting on April 4, 2016 at the Metro Toronto Convention Centre or via live webcast.
Most importantly, on behalf of all of us at OMERS, we wish you and your families a happy and safe holiday season.
Michael & Deb