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Total Fund Management Parts 5.2 and 5.3: Doing TFM Right

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These are Parts 5.2 and 5.3 (continuation of last week's Part 5.1 ) of a seven part series on integrated Total Fund Management brought to you by Mihail Garchev, the former VP and Head of Total Fund Management at BCI and I.  As discussed last week, this is the nexus of TFM and we decided to break Part 5 down into three parts because it was a lot of material.  Please take the time to read Mihail's synopsis below on case studies followed by my comments and clips where he delves deeply into today's topic (added emphasis is mine): This week, we continue our journey into the various practical uses of the Total Fund Management ("TFM") framework and process to solve real-life problems related to total fund decision-making. Before we proceed with the topics today, let us summarize the key takeaways from Episode 5.1. Key takeaways from the first set of case studies in Episode 5.1 last week Last week, we looked at the first set of case studies focused specific

Canada's Top Eight Pensions Unite on ESG Disclosure

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Tim Kiladze of The Globe and Mail reports Canada’s top pension funds issue rare joint call for better ESG disclosures: The heads of Canada's eight largest pension funds, collectively responsible for $1.6 trillion is assets, are banding together for a rare joint request, pleading with corporations to beef up their environmental, social and governance disclosures by reporting the data in a standardized fashion. ESG factors such as diversity initiatives and carbon footprint disclosures, have become crucial investment criteria for institutional money managers in recent years, but the way these companies report these risks and commitments is akin to the Wild West. To streamline decision-making, Canadian pension fund chief executive officers have worked for the past six months to mutually agree on the best frameworks for companies to use -- those from the Sustainability and Accounting Standards Board and the Task Force on Climate-related Financial Disclosures. The leaders backing this i

Is BCI's Governance a Ticking Time Bomb?

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Claude Marchessault, an educator, lawyer and the former executive director of the British Columbia Teachers’, College and Public Service pension plans wrote a comment for Benefits Canada on why he thinks B.C.’s pension governance structure a ticking time bomb:  For years, a major public sector pension governance time bomb has been hidden in plain sight. But it may be too late to alert the bomb squad; the coronavirus pandemic and climate change may have already activated a countdown that can’t be stopped. Investment management is a key component of sustainability and central to any pension governance scheme. Public sector pension funds face increased pressure to deliver higher investment returns so public pension stakeholders can avoid mandatory contribution increases. By definition, this means fund managers must take on greater risk to achieve the higher returns. But in the investment industry, greater risk means increased potential for loss. The key question is whether those

Kevin Uebelein to Depart AIMCo in Mid 2021

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Barbara Shecter of the Financial Post reports that AIMCo chief will leave early as fund positions for 'pivotal' challenges: Alberta Investment Management Corp. (AIMCo) chief executive Kevin Uebelein will step down early, most likely by July 2021, once the $119-billion public asset manager concludes a freshly launched search for his replacement. Uebelein has been CEO since the beginning of 2015, and assets managed by the Crown Corporation have grown by nearly 42 per cent during his tenure. But he was also at the helm when a volatility trading strategy caused $2.1 billion in losses as the coronavirus pandemic roiled markets earlier this year, which prompted the board of directors to conclude in June that risk management controls were “unsatisfactory” and that a culture change was needed at AIMCo. In an exclusive interview with the Financial Post this week, Uebelein said he and the board concluded that AIMCo needs a leader with a fresh perspective and a horizon of sev