Board Meeting Summaries

SC Board Chair and Vice-Chair

The SC Board elected Scott Marks, current Chair of the Plan Design Committee, to the position of Vice-Chair of the SC Board for the term which runs January 1, 2025 through April 14, 2027. Current Vice-Chair, Max Cananzi becomes Board Chair on January 1, 2025.

The Board confirmed that the suspension on specified change proposals set out in By-Law No. 12 will expire on December 31, 2024 as planned and previously communicated. This means that stakeholders will have the opportunity to submit specified change proposals for the SC’s consideration commencing January 1, 2025.

2030 Strategy

As part of the cycle of updating our joint strategy every five years, the AC and SC Boards have worked together to develop OMERS 2030 Strategy. Details will follow in 2025 when the strategy is released externally via the Annual Report and omers.com in February.

Planned Initiatives for 2025

The provincial government informed OMERS in August 2024 of its decision to perform a governance review of OMERS. Until more details of the governance review are known, the SC Board has paused a number of planned SC initiatives which could involve potential governance or related policy changes. The timing and scope of the upcoming governance review will influence the commencement and progress of these initiatives over the next 12 months.

The list of paused governance initiatives has been shared with our Sponsors and Stakeholders. The SC Board will keep our Sponsor and Stakeholder community updated if and when the SC Board decides to resume any of the initiatives.

Administrative Improvements to Board Appointments

Following collaboration with the AC Board, the SC approved a number of administrative improvements for Board appointments. In addition to enhancing internal processes, the term end date for AC and SC Board appointments is being moved from December 31 to April 14, to allow approvals and reporting in respect of the previous calendar year to be completed by the incumbent directors. As well, the general appointment meeting with Sponsors is being replaced with a more customized meeting with each nominating Sponsor, to better ensure the information needs of each Sponsor are met.

The following appointments to the SC Board were completed for the three-year term starting January 1, 2025:

• The Association of Municipalities of Ontario (AMO) has appointed Elizabeth Brown;

• The City of Toronto has appointed Giuliana Carbone; and

• The Ontario Association of Children’s Aid Societies (OACAS) has appointed Tim D’Souza.

The Police Association of Ontario (PAO) removed Dan Axford as their appointee on the SC Board effective July 9, 2024 and appointed Rick Robson to the SC Board for the remainder of the current term ending December 31, 2025. Mr. Robson’s appointment to the SC Board is effective August 20, 2024.

SC Board Chair and Vice-Chair

Following Mr. Axford’s removal, the SC Board elected Max Cananzi to complete the two-year Vice-Chair term ending December 31, 2024, and confirmed Mr. Cananzi’s appointment as the SC Board Chair for the two-year term effective January 1, 2025 until December 31, 2026 in accordance with By-Law No. 3.

Anik Lanthier has been appointed to the AC Board for a three-year term, effective January 1, 2025, following nomination by the Association of Municipalities of Ontario (AMO).

2024 Committee Composition

The SC Board Committee composition for the remainder of 2024 has been updated to reflect recent changes to the SC Board membership. In particular, Deborah Dubenofsky has been appointed Chair, Corporate Governance Committee, replacing Max Cananzi who has been elected Vice-Chair of the SC Board. Rick Robson has been added to the Audit & Human Resources Committee, replacing Ms. Dubenofsky as a voting member of that Committee.

As part of its regular business, the SC considered updates to three policies that guide the Board when making decisions related to contributions, benefits and funding. The policy updates are long-term in nature and reflect our commitments to build reserves as the OMERS Plans mature and maintain the fairness and reasonableness of contributions collected from our diverse membership and employers.

The SC Board also completed its most recent review of contribution rates. These reviews take place with regular frequency and are aimed to assess the continued fairness of the allocation of total Plan funding amongst our members and employers. The results of the review indicated that adjustments to the contribution rates are needed to ensure the continued fairness of the allocation of total Plan funding across the different contribution rates.

The SC met with Sponsors and other Stakeholder organizations who requested a meeting to discuss these proposed changes. Feedback received from these sessions was considered by the SC Board as part of its decision-making process.

At its June 25, 2024 meeting, the SC Board approved updates to the three policies with immediate effect and new contribution rates effective January 1, 2027. The adjustments to contribution rates will result in a reallocation of contributions amongst our members and employers - some will pay more than they would have if contribution rates were not changed, while others will pay less. As this is a reallocation, the total amount of annual contributions received from all members and employers will not change, consistent with the SC Board’s decision last fall to not change benefits or the overall Plan funding level.

Further details on the adjusted contribution rates can be found here.

Further details on the updated policies can be found here.

The RCA Funding Mechanism Policy replaces By-Law Nos. 24 and 28, which have now been repealed. Amendments to simplify By-Law No. 20 have also been made. Copies of the updated policies and the simplified By-Law No. 20 can be found in the SC Governance Manual.

Giulia Volpe has been re-appointed to the SC Board by the Ontario Public Service Employees Union (OPSEU) for a three-year term effective January 1, 2025.

SC Board Chair

At its May 30, 2024 meeting, the SC Board appointed Dan Axford to be Chair of the SC Board for a two-year term effective January 1, 2025. until December 31, 2026 in accordance with By-Law No. 3.

Auditor Re-appointment

At its May 30, 2024 meeting, the SC Board re-appointed BDO Canada LLP as its external auditor for the audit of the SC’s 2024 financial statements.

Policies, By-Laws and other Governance Documents

Policies, by-laws and related processes are regularly reviewed to ensure the documentation that supports our governance and decision making remains relevant and effective. In addition to the policies mentioned above, the following reviews and approvals were also completed during the Q2 meeting cycle:

• Minor updates to the SC Code of Conduct;

• Minor updates to the Member Background Checks Policy for AC & SC Board appointments and reappointments; and

• By-Law No. 4 was updated to provide flexibility in choosing the SC members of the Joint Working Group tasked with the search process for the AC Independent Board Chair.

All of the above-noted updates are effective June 1, 2024 and are available in the SC Governance ManualOpens new window. If you have any questions regarding these updates, please email omerssc@omers.comOpens email client.

The Board approved its audited financial statements and reporting disclosures for 2023, as well as the 2023 Annual Report.

Max Cananzi has been re-appointed to the SC Board by the Electricity Distributors Association for a three-year term, effective January 1, 2025.

David Tsubouchi has been re-appointed to the AC Board for a three-year term, effective January 1, 2025, following a renomination by the Retiree Group.

The SC Board has elected to file the December 31, 2023 actuarial valuation of the OMERS Primary Pension Plan (Primary Plan) with the regulator (the Financial Services Regulatory Authority of Ontario, or FSRA). OMERS performs actuarial valuations of the OMERS Primary Plan on an annual basis to monitor and report on its financial health. A valuation must be filed with the regulator at least once every three years. Once the 2023 valuation report of the OMERS Primary Plan is filed with FSRA, the next required valuation report is for the 2026 valuation. The SC Board can choose to voluntarily file valuation reports with the regulator in the intervening period.

Policies, by-laws and related processes are regularly reviewed to ensure our governance is effective. The SC Board recently approved the following:

• An updated Member Education Policy for SC Board members effective March 1, 2024. This updated policy maintains the emphasis of ongoing education as an important part of effective governance. It is available in the SC Governance Manual on the OMERS website.

• An updated process for reviewing compensation for members of the AC and SC Boards.

At its December 6, 2023 meeting and following a 21-day notice period, the SC Board approved two narrow plan amendments that address feedback on the administration of the OMERS Plans relating to certain leaves of absence. These plan amendments clarify the administration of the disability waiver for new members and preserve plan membership for existing members in certain cases when temporarily joining another employer.

These amendments are effective December 6, 2023. A summary of these amendments can be found here, and the By-Laws containing their details can be found here.

Following the retirement of Sandra Sahli, the Ontario Secondary School Teachers’ Federation (OSSTF) has appointed Pierre Côté for the remainder of Sandra’s current term plus the three-year term commencing January 1, 2025.

The following re-appointments to the AC Board were completed for the three-year term commencing on January 1, 2025:

• John Armstrong, following a nomination by the City of Toronto

• Kevin Skerrett, following a nomination from Canadian Union of Public Employees (CUPE Ontario)

New Audit & Human Resources Committee

The SC Board approved the merger of the Audit Committee and Human Resources & Compensation Committee into a new Audit & Human Resources Committee (AHRC) effective January 1, 2024. This newly created Committee delivers on the objectives for continuous improvement and efficiencies identified by the SC Board in 2022.

The newly created charter of the AHRC, the corresponding administrative updates to three By-Laws (No. 4, No. 5, No. 6), and the CEO role description resulting from this merger can be found in the SC Governance Manual on the OMERS website.

Annual Approvals & Other Updates

The SC Board completed its annual planning cycle including the review and approval of charters, role descriptions, the operating plan and Committee membership for 2024, and corresponding Board and Committee workplans.

The SC Board also updated By-Law No. 3 to create efficiencies and provide flexibility in respect of the SC Board appointment process and completed their regular reviews of a number of policies including, the Conflict of Interest Policy, Corporate Signing Authorities and Invoice Approval Policy, and Reimbursement of Expense Policy.

The updated By-Law and policies are posted in the SC Governance Manual on the OMERS website.

The SC Board regularly conducts reviews of the OMERS plans to ensure they remain sustainable, affordable, and meaningful over the long term. After extensive consideration and analysis in this current review, the SC Board confirmed at its September 2023 meeting that no sustainability-related changes to benefits or contributions are required at this time. You can read more about the factors that the SC considered in its decision here.

The SC Board approved an updated competencies that reflect the range of skills, knowledge and experience that the SC Board needs to govern effectively and satisfy its obligations. The updated framework is in the SC Governance Manual which can be found here.

For the three-year term commencing January 1, 2024:

• Deborah Dubenofsky, has been appointed by the Association of Municipalities of Ontario (AMO); and

• Chris Varcoe, has been appointed by the Ontario Professional Fire Fighters Association (OPFFA).
  

Danielle Harrison has been appointed to the AC Board following a nomination by the Ontario Association of Police Services Boards (OAPSB) for a three-year term commencing on January 1, 2024 and ending on December 31, 2026.

As part of the research for plan risk assessment, the SC held individual meetings with interested Sponsors and Stakeholders. The goal of the meetings was to have an open dialogue where SC could hear their perspectives regarding the long-term health of the OMERS Plans and the various paths to improve resilience as the Plans mature. Feedback from these sessions will be an important consideration for this current review of the Plans.

At its June 21, 2023 meeting and following a 21-day notice period, the SC Board approved a Plan amendment which would revise the methodology by which pensions will be converted from the normal retirement age 65 provisions to normal retirement age 60 provisions. This amendment incorporated a proposal brought forward by the OPFFA as well as discussions with other Sponsors.

This change is effective June 21, 2023. You can read more about the approved Plan change here.

On May 17, 2023, the AC Board approved the establishment of a new standing Committee of the AC Board called the Member Services Committee, effective May 18, 2023. At its June 21, 2023 meeting, the SC Board approved an amendment to By-Law No. 6 to include the annual remuneration for the Chair of this new Committee.

In response to feedback, the SC Board made its Funding Management Statement publicly available, adding it to its Governance Manual which can be accessed here.

At the May 11, 2023 meeting, the SC Board re-appointed BDO at its external auditor for the audit of the fiscal year ending December 31, 2023.

Susan Arab has been appointed to the AC Board following a nomination by CUPE (Ontario) effective April 18, 2023 to complete the current vacant term ending December 31, 2023, and for a three-year term commencing on January 1, 2024 and ending on December 31, 2026.

The Board approved its audited financial statements and reporting disclosures for 2022, as well as the 2022 Annual Report.

Joe Pennachetti has been re-appointed to the SC Board by the City of Toronto for a one-year term commencing on January 1, 2024 and ending on December 31, 2024.

The following re-appointments to the AC Board were completed for the three-year term commencing on January 1, 2024 and ending December 31, 2026:

• Cliff Inskip, following a nomination by the Ontario Public School Boards’ Association (OPSBA)

• Yung Wu, following a nomination from the Police Association of Ontario (PAO)

A process is underway to fill a vacancy on the AC Board as a result of Charlene Mueller’s (CUPE nomination) departure from the Board on January 25, 2023.

The SC Board elected to not file the 2022 actuarial valuation of the OMERS Primary Pension Plan (Primary Plan) with the pension regulator (the Financial Services Regulatory Authority, or FSRA). OMERS performs actuarial valuations of the Primary Plan on an annual basis to monitor and report on its financial health. A valuation must be filed with the regulator at least once every three years. The 2021 valuation report of the Primary Plan was filed with FSRA and, as a result, the next required valuation report is for the 2024 valuation.

The SC completed its triennial review of director compensation for directors of the AC and SC Boards which resulted in adjustments to compensation effective January 1, 2023. The new director compensation can be found in an updated By-Law No. 6Opens new window.

John Weatherup has been re-appointed to the SC Board by CUPE (Ontario) for a three-year term commencing on January 1, 2023 and ending on December 31, 2025.

Diane Kazarian has been appointed to the AC Board following a nomination by the Ontario Association of Children’s Aid Societies (OACAS) for a three-year term commencing on January 1, 2023 and ending on December 31, 2025.

The SC Board worked with an external consultant to conduct its triennial review of Board and Committee performance which was completed in Q4. Based on this review, the SC Board has set objectives for identifying in 2023 opportunities for continuous improvement and efficiencies.

The Board also completed its annual planning cycle including the review and approval of Board and Committee charters and workplans, the 2023 operating plan, and the new 2023 Committee membership which reflects changes to the SC Board Chair and Vice-Chair effective January 1, 2023.

Updated Charters will be posted to the SC Governance ManualOpens new window on the OMERS website.

To assist employers and members with planning over the short term, the SC Board confirmed the following:

• Contribution rates will remain at current levels for 2023, 2024 and 2025; and

• The annual inflation adjustment to pensions in pay will not be impacted by Shared Risk Indexing (SRI) in 2024 and 2025. The 2023 increase was recently announced as 6%.

The SC Board continues to follow a robust process for the plan risk assessment and is targeting decisions in 2023. The Board remains committed to consulting with Sponsors and Stakeholders on a new By-Law No. 12 governing plan changes following completion of the plan risk assessment. As a result of the continuation of plan risk assessment beyond 2022, this consultation is now targeted for 2023/2024 and the SC Board has extended the suspension of the plan change process applicable to individual stakeholder requests to the earlier of approval of a new By-Law No. 12 and December 31, 2024.

Mr. Domenic Maugeri was appointed by the Canadian Union of Public Employees (CUPE) Local 79 to complete the current term ending December 31, 2022. Mr. Maugeri’s appointment is effective as of August 16, 2022 and he was appointed to the Audit Committee.

In addition, for the 3-year term, commencing January 1, 2023 and ending December 31, 2025:

• Domenic Maugeri, has been appointed by CUPE Local 416

• Garry Cubitt, has been appointed by the Ontario Association of Police Services Boards (OAPSB);

• Dan Axford, has been re-appointed by the Police Association of Ontario (PAO); and

• Peter Derochie, has been re-appointed by the Ontario Catholic School Trustees’ Association (OCSTA), in collaboration with the Ontario Public School Boards’ Association (OPSBA).

In response to feedback received by OMERS, at its September 14, 2022 meeting and following a 21-day notice period the SC Board approved a technical Plan change relating to the 2020 Plan amendment that expanded eligibility for non-full-time (NFT) employees to join the Plan. The approved Plan change will introduce some flexibility for the membership date of new NFT employees, to recognize the diversity of payroll systems and procedures across our employer base and avoid complexities for employers and new members that might otherwise result from having a single date for new membership.

This change is effective January 1, 2023.

OMERS commissioned one of Canada’s leading research firms, Pollara Strategic Insights, to conduct a survey of OMERS members to share their perspectives regarding their experiences with us, the Plan and how we communicate with them. This survey was completed in September 2022.

Insights from the survey will help us continue to improve our member service and help OMERS better serve our members now and in the future.

At its August 18, 2022 meeting, the SC Board reviewed and approved revisions to the SC Code of Conduct and SC Confidentiality Policy. Updated versions of these document are available in the SC Governance Manual.Opens new window

At its April 27, 2022 meeting, the SC Board approved the filing of the year end 2021 Actuarial Valuation Report of the OMERS Primary Pension Plan (Primary Plan) with the regulators. The filing means that the next required valuation filing will be in three years (effective date of year end 2024). The SC Board can choose to voluntarily file valuation reports with the regulator in the intervening period.

At its April 27, 2022 meeting, the SC Board reappointed Mr. George Cooke as the AC Board Chair for a three-year term commencing January 1, 2023 and ending December 31, 2025. On May 19, 2022, the SC Board appointed Ms. Karen Figueiredo to the AC Board effective immediately (to replace Ms. Laurie Hutchinson who was appointed CEO of the SC) to complete the current term ending December 31, 2022, and for a three-year term commencing January 1, 2023 and ending December 31, 2025.

The SC Board confirmed the appointment of Mr. Barry BrownOpens new window, the current Vice-Chair of the SC Board, to the position of Chair of the SC Board for a two-year term effective January 1, 2023 until December 31, 2024 in accordance with Section 1.8 of By-Law No. 3. The SC Board also appointed Mr. Dan AxfordOpens new window, the current Chair of the SC Corporate Governance Committee, to the position of Vice-Chair of the SC Board for a two-year term effective January 1, 2023 until December 31, 2024.

The Plan Design Committee (PDC) continues to discuss plan risk assessment, which includes evaluating the risks, challenges and opportunities for the Primary Plan and Retirement Compensation Arrangement (RCA). The plan risk assessment involves looking for ways to build sufficient resilience and improve sustainability while continuing to provide meaningful benefits at an affordable cost. The PDC has reviewed extensive analysis and is in the initial stages of considering options for improved resilience. We will engage with our stakeholders on any changes being considered before any decisions are made.

The final 2021 Annual Report was reviewed by the Board at its February 23, 2022 meeting and the SC content was approved.

At its February 16, 2022 meeting, the SC Board approved the re-appointment of Mr. William (Bill) Butt, Mr. Paul Elliott and Ms. Penny Somerville for a three-year term on the AC Board commencing January 1, 2023.

A joint SC/AC Sponsor & Stakeholder Forum was held on February 28, 2022. The Forum focused on a number of topics, including the release of the 2021 results, an update on Plan change proposals, a presentation on the risks facing the Plan, and a review of research conducted with Sponsors, Stakeholders and members.

The Plan Design Committee (PDC) continues to discuss plan risk assessment. Sustainability remains a key challenge for all pension plans, and all discussions center around keeping the OMERS Plan sustainable, meaningful and affordable. OMERS has already taken some important steps to improve our resiliency and the PDC examined ways to continue building resilience and improving sustainability.

The SC appointed Laurie Hutchinson as the CEO of the OMERS Sponsors Corporation, effective April 18, 2022. Ms. Hutchinson will be responsible for the organizational leadership and direction as well as assisting the Board in achieving its mission and delivering on its key responsibilities.

As part of its comprehensive review of the process for appointing AC Board members, the SC Board approved an amended By-Law No. 4 at its October 26, 2021 meeting, which reflected input received from the AC Board. The amendments included updating the process for the appointment of the AC Board Chair. The changes to the By-Law required several ancillary updates to the Nomination Advisory Committee Charter. These documents can be found in the SC Governance Manual on the OMERS website.

At the December 8, 2021 meeting, the SC Board approved the appointment of Mr. John Armstrong as the nominee of the City of Toronto, commencing January 1, 2022, for a three-year term; and the reappointment of Mr. Rajiv Silgardo as the nominee of the Ontario Professional Fire Fighters Association, for another three-year term, commencing January 1, 2023.

At its November 18, 2021 meeting, the SC Board voted to extend certain Plan changes intended to provide flexibility to plan members resulting from absences due to COVID-19. These changes had originally been approved in 2020, and were extended for an additional year due to the continuing impact of the pandemic. More information on the extension of these COVID Plan changes can be found here on the OMERS website.

The SC Board had been considering plan risk issues throughout the year. The SC Board, working in conjunction with its colleagues at the Administration Corporation, has spent a significant amount of effort on risk management in the past three years, and in the December 8, 2021 meeting, the SC Board approved updated risk appetite statements for the OMERS Primary Plan and the Retirement Compensation Arrangement (RCA).

Recognizing the importance of ensuring that SC Board members maintain and enhance the skills and knowledge that they bring to the boardroom, the SC Board approved an updated director development plan as recommended by the Human Resources and Compensation Committee, focused on a three-year planning cycle, including recommendations on director certification.

The SC Board had implemented a number of new human resources policies in 2020 as part of the by-law simplification program. These policies were reviewed after one year of operation and a number of changes were made and approved at the November 18, 2021 meeting to refine these policies. In addition, the charters for each of the standing committees were reviewed and updated. At the December 8, 2021 meeting, the SC went through a similar review process for the role descriptions for the Board Chair, Vice-Chair, Committee Chairs, and Board members. Committee Charters and Board-related role descriptions can be found in the SC Governance Manual on the OMERS website.

At its August 18, 2021 meeting, the SC Board adopted a change to the Additional Voluntary Contributions (AVC) program, with respect to the window of time during which members can make lump-sum transfers. Starting in 2022, members can make lump-sum transfers to their account between January 1 to June 30 each year. Members can continue to make automatic and catch-up contributions throughout the calendar year.

At its August 18, 2021 meeting, the SC Board approved the appointment of Mr. Kevin Skerrett on the nomination of CUPE Ontario for a three-year term on the AC Board commencing January 1, 2022.

Also at its August 18, 2021 meeting, the SC Board approved an updated Nomination Advisory Committee Charter to support the work of the SC Board in working with Sponsor Organizations and the AC Board in nominating and appointing new AC Board members. The Charter reflected input from the Administration Corporation. The Nomination Advisory Committee Charter can be found in the SC Governance Manual on the OMERS website.

On the recommendation of the Human Resources & Compensation Committee, the SC Board approved an updated Skills Matrix for the SC Board at its September 21, 2021 meeting, to reflect recent departures and appointments. A skills matrix reflects the range of skills, knowledge and experience that the SC Board possesses in order to meet its obligations. Information on the process the SC uses to evaluate these factors through its Board Competency Framework can be found in the SC Governance Manual on the OMERS website.

The Board approved a series of resolutions regarding specified plan changes, which included waiving the decision-making timelines set out in By-Law No. 12, and suspending the process for submitting further specified plan change proposals pending a review of that By-Law by the SC Board. This was intended to provide greater flexibility to the Board to engage in a broader plan risk assessment, and to further evaluate five (5) plan change proposals submitted to the Board (including those relating to NRA conversions) holistically as part of its plan risk assessment.

The Board approved a suite of polices and processes intended to enhance the protection of personal privacy and support a robust AC and SC Board member appointment process, including a new Member Background Checks Policy, amendments to the Confidentiality Policy and the Code of Conduct Policy, and the establishment of related guidelines, together with corresponding changes to By-Law No. 3 (and in Q4, 2021 to By-Law No. 4). All of these By-Laws and Policies can be found in the SC Governance Manual on the OMERS website.

At the May 21, 2021 meeting, the SC Board reappointed BDO at its external auditor for the fiscal year ending December 31, 2021.

The SC Board approved a process to evaluate the role and compensation for the SC CEO position commencing in 2022, following the conclusion of the existing contract for the SC CEO. This work progressed over the balance of the year, with several interim steps in progress, including the retainer of an executive search firm in October to identify candidates for the successor CEO.

The annual valuation of the OMERS Primary Pension Plan must be filed with the regulators every three years and may be filed more frequently. At its March 23, 2021 meeting, the SC Board decided to file the December 31, 2020 Primary Plan actuarial valuation with the regulators.

At its March 23, 2021 meeting, the SC Board approved the re-appointment of Mr. David Tsubouchi and Mr. Michael Fenn for a three-year term on the AC Board commencing January 1, 2022.

At the end of 2020, the SC Board concluded its AC/SC Board Composition Review and its SC Board Effectiveness Review. The Board approved the final report at its March 23, 2021 meeting. The link to the report, posted on the OMERS website, can be found hereOpens new window.

At the end of 2020, the SC Board concluded the by-law and policy simplification process and approved the related new Governance Manual at its February 23, 2021 meeting. The link to the manual, posted on the OMERS website, can be found here.

The SC received eight (8) plan change proposals last fall in accordance with the plan change process outlined in By-Law No. 12Opens new window. At its February 23, 2021 meeting, the Board decided to refer all eight (8) proposals to the CEO for further analysis.*

*Note that at the Board’s meeting on April 7, 2021, the Board decided that only five (5) of the eight (8) plan changes proposed would be further analyzed. The decision made at the April 7, 2021 Board meeting does not commit the Board to propose or approve plan amendments for any of the five (5) proposals.

The SC Board concluded its Board Composition Review at its December 8, 2020 meeting and decided there would be no change to the current composition of either the SC or AC Boards. The SC Board will work with the AC on a comprehensive review of affiliation data over the coming year.

At the same meeting, the SC Board concluded a number of board effectiveness initiatives and decided to make no changes to its current practices regarding weighted voting and matters requiring super-majority votes. The SC Board also decided to defer consideration on the use of arbitration to resolve disputes regarding plan changes and incorporate it into a broader review of the overall Plan change process commencing in 2021. It also voted to remove the arbitration provision over disputes relating to the nomination of AC Board members for appointments after January 1, 2022 so that the current nomination process already underway is not impacted.

The SC Board also decided to adjust the compensation of the Chair and Vice-Chair, increasing the compensation of the Chair by $10,000 and reducing the compensation of the Vice-Chair by an equivalent amount, to reflect the change in responsibilities and time commitments for the two roles.

The SC Board also approved a number of changes designed to simplify its by-law and policy structure, which included updating and restating the OMERS Plan text to incorporate changes made since 2014 into one consolidated document, to realign its policies and update the language to reflect the governance changes approved in the Board Effectiveness Review, and to reallocate several matters previously addressed in by-laws to Board policies. These include matters such as conflict of interest, signing authorities, Board member expenses and Board member education. The SC Board confirmed that all matters reallocated from by-laws to policies would continue to be made available for public review through a new Governance Manual to be posted on the OMERS website in Q1 2021.

At a special meeting on July 14, 2020, the SC Board approved the scope of the review and the form of communication to sponsors and stakeholders. The SC Board confirmed that it would consider the question of who should sit on the SC and AC Boards, based on the member and employer affiliation data at the end of 2019, and applying the principles approved in May, 2020.

Chair and Vice-Chair roles

At its August 20, 2020 meeting, the SC Board approved the election of Frank Ramagnano as the Chair of the SC Board, and the election of Barry Brown as the Vice-Chair of the SC Board, effective January 1, 2021.

Board Member Assessment Process

At its August 20, 2020 meeting, the SC Board approved the board assessment conducted by its Human Resources & Compensation Committee, approved the skills matrix applying the information collected during the assessment, and identified areas for future discussion with sponsors as board member term limits take effect.

Voting and Arbitration

In Q3, in conjunction with the Board Composition Review discussed above, the SC Board approved the scope and plan for completing the remaining outstanding items in the Board Effectiveness Review, focusing on weighted voting, where some directors have multiple votes, matters requiring 2/3 majority voting, and matters where issues under consideration by the SC Board can be referred to external arbitration, namely plan design decisions where the Board is not able to reach a 2/3 majority vote, and appointment of AC Board members.

Following a report and recommendation from the Risk Oversight Committee, the SC Board approved a Risk Framework, a risk appetite statement for the Primary Plan, a risk appetite statement for the Retirement Compensation Arrangement, and subsidiary risk appetite statements for pension risk, operational risk and governance risk. The risk appetite statements were also approved by the AC Board.

Shared Risk Indexing

At its February 25, 2020 meeting, the SC Board authorized the CEO to obtain public feedback from sponsors, stakeholders, Plan members and employers regarding a proposal to implement Shared Risk Indexing. The Board decided that any changes would only take effect as of January 1, 2023.  The SC Board also directed the CEO to evaluate a funding management approach that would guide Board decision-making in the future.  The Board had a series of meetings to consider alternative approaches.  It also considered whether it would be appropriate to postpone its decision due to the COVID-19 pandemic and determined that it would maintain its original timeline.  At its June 24, 2020 meeting, the Board voted to approve By-Law No. 42 and amend By-Law No. 20 to implement the Shared Risk Indexing Plan amendment and establish the current inflation adjustment at 100%. Learn more about how we are preparing for the future and more details on Shared Risk Indexing.

Non-full-time expansion

Also at its February 25, 2020 meeting, the SC Board authorized the CEO to obtain public feedback on a proposal to expand eligibility for non-full-time members to join the Plan by removing current eligibility requirements.  The Board also decided that these changes would be effective as of January 1, 2023.  At its June 24, 2020 meeting, the SC Board voted to approve By-Law No. 43 to implement the non-full-time expansion Plan amendment.

COVID-19 proposals

At its May 19, 2020 meeting, the Board agreed to consider three proposals relating to extending leave purchase options, reducing the 36-month employment requirement for leave purchases and permitting temporary layoffs as purchasable service, all of which were intended to reduce the hardship faced by employees from workplace changes brought about by the COVID-19 pandemic.  This decision was made under the SC Board’s by-law provision that allows for Plan changes relating to unforeseen circumstances where a failure to act could create hardship for Plan members.  At its June 24, 2020 meeting, the SC Board voted to approve By-Law No. 45 to implement the COVID-19 proposals.  The SC Board also voted to approve By-Law No. 44 to update a number of section references resulting from previous changes to the Plan text.

The SC Board recognized that the Plan change program would require a significant effort to engage with sponsors and stakeholders, as well as Plan members generally.  The Board directed the CEO to allocate additional internal and external resources to the program, and at its February 25, 2020 meeting, it also directed the CEO to extend the external engagement process from the minimum one month (May to June) contemplated in the corporation’s by-laws to four months (March to June) to provide additional time for sponsor and stakeholder input.  The Board considered the impact of COVID-19 on the consultation process and after much discussion confirmed at its May 19, 2020 meeting that it would adhere to its original timeline.

The SC Board considered a proposal to extend the term limits for OMERS Administration Corporation (AC) Directors, looking at peers and leading practices, and at its February 13, 2020 meeting, it agreed to extend AC Directors' term limits to 12 years, and apply the same term limits at the Sponsors Corporation.

The SC Board had approved a number of initiatives in November 2019 relating to its Board Effectiveness Review.  In Q1 and Q2 of 2020, it approved several processes to implement these initiatives, as follows:

Chair and Vice-Chair roles

At its February 25, 2020 meeting, the SC Board approved formal Board Chair and Vice-Chair role descriptions.  At its May 19, 2020 meeting, the SC Board approved changes to By-Law No. 4 to implement the selection process for the Chair and Vice-Chair, to appoint them as of January 1, 2021.

Board Disciplinary Guidelines

At its February 25, 2020 meeting, the Board approved formal disciplinary guidelines to deal with circumstances where a Board member fails to meet the standards of behavior set out in the SC’s Code of Conduct, or where the Board member’s participation and attendance at Board meetings is a concern.

By-Law No. 6 regarding compensation

At its February 25, 2020 meeting, the SC Board approved changes to By-Law No. 6 to implement the Board member compensation changes for both the SC Board and OMERS Administration Corporation (AC) Board that had been approved in December 2019, as well as the related changes to Board member expense guidelines.

Work plans and agendas

At its April 9, 2020 meeting, the SC Board approved a process to formalize the development of its annual work plans.  This is important to ensure that the Board has the time and resources required to achieve its annual objectives.

Board Member assessment process

In 2019, the SC Board approved a Competency Framework (Framework) that was intended to identify the skills, knowledge and experience that the Board needs to fulfil its functions. The Framework will assist in building the Board in the future and also identify development opportunities within the current Board.  At its June 24, 2020 meeting, the SC Board approved the process that it would use to conduct self-assessments against the Framework, complete a skills matrix and prepare a gap analysis to show where it needed to focus its efforts in the future.  The process will be completed by the end of Q3.

The SC Board has previously conducted Board composition reviews in 2013 and 2016.  These reviews address a number of governance issues, but most fundamentally consider the composition of the SC and OMERS Administration Corporation (AC) Boards, and who sits on these boards.  At its May 19, 2020 meeting, the SC Board approved a series of principles that it would apply in conducting the 2020 review.

The annual valuation of the OMERS Primary Pension Plan must be filed with the regulators every three years and may be filed more frequently.  At its February 25, 2020 meeting, the SC decided to file the December 31, 2019 actuarial valuations with the regulators in respect of the Primary Plan.

The OMERS SC Board and the OMERS Administration Corporation Board (AC) approved the 2025/2030 Joint Strategy in May 2019.

The OMERS strategy is about making the right choices today in light of the challenges facing us today and tomorrow and provides direction to deliver on:

• long-term objectives: making OMERS a sustainable, affordable and meaningful defined benefit Plan; and

• five-year strategic priorities: Plan Design, Plan Funding, Investment Strategy, Operations and Stakeholder Engagement.

The strategic framework was communicated to stakeholders in June 2019.  Read more about OMERS Strategy.

CEO appointment

The SC appointed Michael Rolland as the interim CEO of the OMERS Sponsors Corporation (SC) effective April 15, 2019. His appointment was made permanent at the November 2019 Board meeting. Mr. Rolland is responsible for organizational leadership and direction as well as assisting the Board in achieving its mission and delivering on its key responsibilities.

Board Effectiveness Review

Throughout 2019, the SC Board conducted a Board effectiveness review with the goal of ensuring OMERS has the most effective possible arrangements to meet the highest contemporary governance standards.

The SC’s Corporate Governance Committee met several times in 2019 about this review and was supported in its work by both OMERS management and outside governance and legal experts. The goal was to improve the SC’s governance regime and promote effective decision making to ensure OMERS is sustainable, affordable and meaningful defined benefit pension plan.

As a result, the SC Board has approved changes that will strengthen the governance framework and support its commitment to members, employers and other stakeholders.  These changes will also help ensure that the Directors of the Sponsors Corporation collectively have the right skills and competencies.

An overview of the changes resulting from the board effectiveness review can be found here.

Board remuneration

The SC is responsible for the remuneration of Directors of both the SC and OMERS Administration Corporation (AC) Boards. Remuneration levels are reviewed every three years.  At its December 2019 meeting, the SC approved compensation increases for Directors of both Boards effective January 1, 2020. Details are included in the 2019 Annual Report.

Amendments from 2018 Plan changes

Resulting from the 2018 Plan-change decisions to remove the 35-year service limit and to make NRA 60 available to paramedic employers effective January 1, 2021, the SC Board approved By-Law No. 38, which pertains to the amendment of the Primary and Supplemental Plans to reflect those Plan changes.

City of Toronto Pension Transfer Agreements

At its August 31, 2017 Board meeting, the SC Board authorized the Co-Chairs and CEO to enter into pension transfer agreements among the SC, OMERS Administration Corporation (AC) and municipalities that had legacy pension plans predating OMERS.  Each pension transfer agreement, once executed, would have the effect of merging an individual closed plan into the Primary Plan.

At the end of 2018, the SC Board approved By-Law No. 37, which amends the Primary Plan to bring the members of the City of York Employee Pension Plan (“York Plan”) in the Primary Plan. 

A pension transfer agreement was reached for the Corporation of The Toronto Civic Employees’ Pension Plan (“Civic Plan”). In August, the SC Board approved By-Law No. 39, which amends the Primary Plan to bring the members of the Civic Plan into the Primary Plan.

A pension transfer agreement was reached for The Metropolitan Toronto Police Benefit Fund (“Police Plan”). In October, the SC Board approved By-Law No. 40, which amends the Primary Plan to bring the members of the Police Plan into the Primary Plan.

A pension transfer agreement was reached for The Metropolitan Toronto Pension Plan (“Metro Plan”). In November, the SC Board approved By-Law No. 41, which amends the Primary Plan to bring the members of the Metro Plan into the Primary Plan.

There are no other City of Toronto mergers being considered.

In March 2019, the SC re-appointed Ms. Penny Somerville, Mr. Paul Elliott, Mr. Bill Butt and Ms. Laurie Hutchinson for three-year terms commencing January 1, 2020.

In August 2019, the SC appointed two new directors Mr. Rajiv Silgardo and Ms. Debbie Fischer for three-year terms commencing January 1, 2020 to replace two existing directors who reached their term limit at the end of 2019.

In December 2019, the SC re-appointed Mr. Yung Wu and Mr. Cliff Inskip for three-year terms commencing January 1, 2021.

Mr. John Weatherup, Mr. Jason Chan, Mr. Fred Biro, Mr. Pete Derochie, Mr. Dan Axford and Mr. Paul Bailey were re-appointed by their respective Sponsors for another three-year term commencing January 1, 2020.

Ms. Giulia Volpe was appointed by OPSEU (replacing Ms. Jennifer Richards) effective November 1, 2019 for the remainder of the existing three-year term.

The annual valuation of the OMERS Primary Pension Plan must be filed with the regulators every three years, and may be filed more frequently.  Although they were not required filings, at its March 2019 meeting, the SC decided to file the December 31, 2018 actuarial valuations with the regulators in respect of the Primary Plan.

The SC and OMERS Administration Corporation (AC) Boards met in November to jointly review the preliminary actuarial assumptions for the December 31, 2019 valuation.