Meeting Summary

OAC Board - February 22, 2018

2018 OAC Board Work Plan

The mandate of the OAC Board requires the Board to establish its work plan annually.  The OAC Board work plan functions as a checklist to satisfy the responsibilities of the Board as delegated to it by the Board-approved mandate.

The OAC Board approved its 2018 Work Plan, which was prepared to comply with the OAC Board Mandate approved by the Board at its meeting held on December 14, 2017.

Confirmation of Appointment of Officers

In order to facilitate compliance reporting and certification requirements in other jurisdictions, OAC has found it useful to summarize the current senior officers of the corporation in an annual confirmatory resolution.  Also, to facilitate the signing of certificates and powers of attorney, it is useful to appoint various corporate counsel as assistant corporate secretaries.

The OAC Board approved a resolution that gave effect to this intention.

Enterprise Risk Report – Q4 2017

The quarterly Enterprise Risk Report to the Board provides an update on OMERS risk profile.  The Q4 2017 report included a new section on the risk profile at the Primary Plan level.

Following questions and discussion with the Chief Risk Officer, the OAC Board approved the Q4 2017 Enterprise Risk Report.

2017 Valuation of the OMERS Primary Pension Plan

Each year, Willis Towers Watson prepares an actuarial valuation report for the Primary Plan.

As recommended by the Audit & Actuarial Committee at its meeting held on February 8, 2018, the OAC Board approved the following:

  • the actuarial methods and assumptions for the Primary Plan; and
  • the annual actuarial valuation of the Primary Plan.

2017 Valuation of the Retirement Compensation Arrangement for the OMERS Primary Pension Plan

Each year, Willis Towers Watson prepares an actuarial valuation report for the Retirement Compensation Arrangement (the “RCA”).

As recommended by the Audit & Actuarial Committee at its meeting held on February 8, 2018, the OAC Board approved the following:

  • the actuarial methods and assumptions for the RCA; and
  • the annual actuarial valuation of the RCA.

2017 OMERS Primary Plan and Supplemental Plan Valuation Regulatory Filings

Each year, Willis Towers Watson prepares an actuarial valuation report for the OMERS Primary Pension Plan (Primary Plan) and, if applicable, an actuarial valuation report for the OMERS Supplemental Pension Plan for Police, Firefighters and Paramedics (Supplemental Plan).

Pursuant to its mandate, the Audit & Actuarial Committee recommends to the OAC Board whether the Sponsors Corporation should file these actuarial valuations with the applicable regulators.

As recommended by the AAC at its February 8, 2018 meeting, the OAC Board approved the following:

  • the recommendation to the Sponsors Corporation to file the actuarial valuation of the Primary Plan with the applicable regulators; and
  • the recommendation to the Sponsors Corporation to file the actuarial valuation of the Supplemental Plan with the applicable regulators.

2017 Audited Financial Statements, Management Discussion and Analysis, and Press Release

With respect to financial reporting, Section 21 of the OMERS Act, 2006, requires that OAC prepare a report on the affairs of the OMERS Pension Plans during the preceding year containing a copy of the audited financial statements and that OAC shall give a copy of the annual report to every employer participating in the Pension Plans and to any member, former member or retired member of the Plans who requests it.

Pursuant to its mandate, the Audit & Actuarial Committee is to recommend to the OAC Board approval of the following:

  • annual audited financial statements; and
  • management discussion and analysis content to be included in OAC’s Annual Report and other material public announcements regarding financial matters.

As recommended by the Audit & Actuarial Committee at its meeting held on February 15, 2018, the OAC Board approved the following:

  • OMERS Administration Corporation’s 2017 consolidated financial statements and Audited Financial Statements – Managed Plans;
  • the management discussion and analysis (“MD&A”) and the Front Section included in OMERS 2017 Annual Report and other material public announcements regarding financial matters; and
  • the press release with respect to the 2017 results.

2017 OAC Board Remuneration and Attendance Report (Annual Report)

For the past several years, the Governance Committee has reviewed and recommended to the OAC Board the governance portions of the Annual Report, in a similar manner as the Audit & Actuarial Committee reviews the financial statements and MD&A and the Human Resources Committee reviews the Compensation Discussion & Analysis.

There are two main areas in the Annual Report that deal with governance matters – in the report dealing with Board remuneration and attendance and in the overall narrative.

As recommended by the Governance Committee at its meeting held on February 21, 2018, the OAC Board approved the 2017 OMERS Administration Corporation Board Remuneration and Attendance Report for inclusion in the 2017 Annual Report.

Risk Oversight Committee Mandate

In June 2017, the OAC Board approved the establishment of an ad hoc Risk Oversight Committee to oversee, on behalf of the Board, a number of significant risk management issues, including the development of an overall Risk Appetite Statement for OMERS, corresponding subsidiary risk appetite statements, a risk framework and a risk governance structure.  The expectation was that the mandate would terminate on June 30, 2018.

A Risk Appetite Statement for the Primary Plan was approved at the December 2017 OAC Board meeting and work progressed against the other deliverables.  At its January 30, 2018 meeting, the Risk Oversight Committee realized that it would be challenging to achieve the deliverables by June 30, 2018 and that the Committee would not have an opportunity to oversee the implementation and operation of any of these initiatives.  As a result, Risk Oversight Committee requested that the Board Chair propose to extend the mandate of the Committee to December 31, 2018.

As recommended by the Governance Committee at its meeting held on February 21, 2018, the OAC Board approved the extension of the mandate of the ad hoc Risk Oversight Committee to December 31, 2018 with a minor amendment.  Mandates are posted to the OMERS website.

Investment Committee Mandate

The Investment Committee mandate gives authority to the Investment Committee to approve transactions that exceed the authority delegated to Management.  The OAC Board was asked to consider a change to the IC mandate to expand the scope of the existing mandate to include the following responsibilities:

  • review of OMERS Finance Trust (OFT) strategy and plans regarding borrowings, either by way of credit facilities or note offerings; and
  • approval any OAC guarantees of such OFT borrowings.

As recommended by the Investment Committee at its meeting held on February 20, 2018 and by the Governance Committee at its meeting held on February 21, 2018, the OAC Board approved the amended Investment Committee Mandate, effective March 1, 2018.  Mandates are posted to the OMERS website.

Compensation Discussion and Analysis (Annual Report)

The Human Resources Committee mandate requires the Committee to recommend to the OAC Board compensation-related disclosure in public documents such as the OAC Annual Report.

Each year the OAC Annual Report includes a section on executive compensation, which covers the compensation and pension value earned to the end of December 31 of the respective performance year for the CEO, CFO and the three other most highly compensated executive officers.

The Canadian Securities Administrators require executive compensation disclosure for all Canadian public companies.  While OAC is not subject to these requirements, OAC has voluntarily adopted similar disclosure as a good governance principle and to enhance transparency to Plan members.  The CD&A is also consistent, although more transparent than some, with how other Canadian pension plans capture executive compensation information in their annual reports.

As recommended by the Human Resources Committee at its meeting held on February 20, 2018, the OAC Board approved the 2017 Compensation Discussion and Analysis for inclusion in the Annual Report.

HR Matters

Following discussion, and as recommended by the Human Resources Committee at its meeting held on February 20, 2018, the OAC Board approved the 2017 CEO compensation awards and payments.