Uproar Over Executive Compensation at La Caisse is Misplaced

The Canadian Press reports senior Quebec pension plan executives paid over $17M in remuneration and compensation:

The six most senior executives at the Caisse de dépôt et placement du Québec received a total of $17.15 million in total remuneration and other compensation payments in 2025.

This information is contained in the annual report of the “Quebecers’ nest egg,” published on Wednesday.

Chairman and CEO Charles Emond was awarded total remuneration of $5.1 million, compared with $4.9 million in 2024, representing an increase of approximately one per cent.

The remuneration and other terms of employment of the president and CEO are determined in accordance with parameters set by the government, following consultation with the board of directors.

The annual base salary of Michael Sabia’s successor was maintained at $550,000 in 2025.

Emond also received annual variable remuneration of $4.5 million, as well as $23,799 in pension plan contributions paid by La Caisse and other benefits totalling $54,906.

In a news release, La Caisse highlights that, “under Mr. Emond’s leadership, La Caisse delivered a return of 9.3 per cent over one year, with a level of risk tailored to depositors’ needs, thereby helping to maintain the excellent financial health of their schemes, even in an environment marked by uncertainty and profound changes.”

It adds that Emond “achieved his ambition of $100 billion in Quebec assets ahead of schedule” and “ensured, through his effective handling of complex situations that arose, the progress of key projects.”

She cites, in particular, the opening of the REM’s Deux-Montagnes branch, the start of planning work for TramCité, and Alto’s selection of the Cadence consortium to build the high-speed rail link between Quebec City and Toronto. 

Earlier today, La Caisse released its 2025 Annual Report: 

La Caisse today presented its Annual Report for the year ended December 31, 2025.

In addition to the financial results published on February 25, La Caisse presents an overview of its activities over the last year. The report includes:

• A presentation of La Caisse’s 48 depositors and their respective net assets as at December 31, 2025
• A detailed analysis of the overall return and different asset classes
• A risk management report
• An overview of La Caisse’s presence in Québec, where its assets reached the historic milestone of $100 billion, one year ahead of schedule, including highlights of La Caisse’s key achievements in supporting company growth and implementing structuring projects that contribute to economic development
• A section on governance, including reports from the Board of Directors and its committees covering audit, governance and ethics, investment and risk management, human resources management and compensation, as well as compliance activities
• The Sustainable Development Report, highlighting the new climate strategy adopted in 2025, which aims to accelerate the decarbonization of the real economy
• The financial report and consolidated financial statements
• The Report on Global Investment Performance Standards (GIPS) Compliance

The Annual Report Additional Information for the year ended December 31, 2025, was also published today.

But instead of focusing on that, Quebec's media is in an uproar that Charles Emond's total compensation reached $5.1 million and senior executive compensation surpassed $17 million:

Basically, all the articles are questioning why so much compensation was doled out when La Caisse underperformed its benchmark in 2025.

Alright, let me give you my quick thoughts here.

Whenever you look at compensation, look at 5-year returns rather than one-year because that's what it's primarily based on.

From table 21 on page 44 of the annual report:

As you can see, La Caisse underperformed its benchmark last year (9.3% vs 10.9%), mostly owing to the underperformance in private equity. 

I covered the results already in late February with the Head of Liquid Markets, Vincent Delisle (see my comment here).

Notice on the table above, over the last 5 years, La Caisse delivered an annualized return of 6.5% vs 6.2% for its benchmark.

And that's what primarily determines compensation.

Over a 10-year period, La Caisse delivered 7.2% annualized vs 6.9% for their benchmark.

The report on compensation starts on page 80 of the annual report and it goes into detail how they benchmark compensation relative to peers and determine it. 

Below, you can see the table outlining executive compensation on page 89:

I have no issue with the compensation that was doled out to Charles Emond and other senior executives (and that includes the $2.2 million severance doled out to Marc Cormier, former SVP, Fixed Income).

Again, look at asset class performance over the last 5 years and see how they get compensated relative to peers.

By the way, despite having the best performance among Maple Eight funds last year, Charles Emond and company received less total compensation than their peers in Toronto.

I'm not going to get into details here, you will have to wait this fall for the 2026 Pension Pulse Compensation Report, but suffice it to say that all the senior execs at Canada's Maple Eight received millions in compensation despite underperforming their benchmark last calendar and fiscal year. 

I've said it before, these people are paid extremely well and they all know it.

It's a great gig if you can land a senior exec job at one of Canada's large pension funds (politics plays a big role in landing these jobs).

Of course, they all have to deliver on long-term targets and in La Caisse's case, its dual mandate adds more challenges to the mix.

Moreover, Charles Emond is constantly in the spotlight; he has to appear in media to explain their activities and that adds extra pressure.

Don't get me wrong, he gets paid $5M total compensation to do this job, I'm not crying for him, I'm just stating that being the CEO of La Caisse isn't as glamorous or fun as you think.

Charles Emond and his senior execs are doing an outstanding job, not perfect, but they're delivering on key targets, including responsible investing.

Yes, they're all being paid extremely well, but that's the industry and it's a whole other discussion on whether or not Canada's senior pension fund managers are all getting paid way too much (according to my friends, their returns are "a joke" relative to the S&P 500 and "they're all overpaid").

Alright, let me wrap it up there, I'm bummed out the Habs lost to the Sabres in Game 1 but this series will be tougher than their first one Sabres have an excellent team).

Below, Canadians are demanding answers, but is the Bank of Canada listening? In this Public Accounts Committee hearing, officials are grilled over a court challenge to disclose senior executive compensation. While other central banks are open, why is Canada resisting? Watch as the committee pushes for transparency on taxpayer-funded salaries and the "personal information" defense. 

I personally find it ridiculous that the annual report of the Bank of Canada and all Canadian Crown corps don't have detailed compensation tables just like our pension funds disclose every year.