1. Why now? What is the rationale behind this review?
In 2018, as a part of its normal course of business, the OMERS Sponsors Corporation (SC) Board conducted a governance self-assessment. Coming out of that process, a decision was made to conduct a more in-depth review. Reviews like this are also required by our By-Laws.
In 2019, that more detailed review of the Board’s governance processes and structures (“Board Effectiveness Review”) began, with a goal of improving the SC’s governance and promoting more effective decision-making. Another goal was to align the SC Board’s practices with those of the OMERS Administration Corporation (AC) Board to the extent possible. Effective governance helps us achieve our primary goal of having a sustainable, affordable and meaningful Pension Plan.
2. Are changes needed?
Based on the input from Board Members during the 2018 self-assessment, the Board determined that changes were required to strengthen the SC’s governance framework. Reviewing our governance processes is a healthy practice and is required in our By-Laws.
It’s important to ensure OMERS has the most effective possible arrangements to meet the highest contemporary governance standards. In this process, we looked at what other organizations do and consulted with governance and legal experts. Our overall guiding principle is what is best for OMERS and its members.
3. Are these changes happening due to the results of the Comprehensive Plan Review (CPR)?
No, the results of the CPR are independent from our Board effectiveness review. OMERS regularly reviews its governance practices, just like all effective Boards do.
4. How will these changes be implemented? When will these changes come into effect?
The changes will be implemented in a phased approach. Most of the changes will come into effect January 1, 2020. Other changes, such as those relating to the Chair model and term limits, will come into effect January 1, 2021.
5. Why was there no consultation before you made these changes?
The SC Board Members had the opportunity to meet with their Sponsor organizations to discuss the proposed changes and listen to any concerns that they may have. This was done before the Board voted on any of the changes. The SC Board always keeps the views and interests of OMERS members in mind when making decisions.
6. Is the SC allowed to make these changes? Don't you need government approval?
The OMERS Act gives full authority to the SC Board to make changes. No government approval is required.
7. Will Sponsors organizations still have the right to appoint Members to the Board?
Yes, Sponsor organizations will continue to have the right to appoint directors to the Board. That is not changing as a result of this review.
8. Are these measures intended to diminish the influence of Sponsor organizations?
No, Sponsors will continue to play a fundamental role in the governance of the OMERS Pension Plan. The intent of these changes is to strengthen our governance framework and adopt the best governance practices while maintaining the key role that Sponsor organizations play.