Pensions Committee Terms of Reference
The University sponsors several pension plans for the benefit of its employees. The University is the administrator of the plans in accordance with the Pensions Benefits Act. The Board of Governors (the Board) is ultimately accountable for the administration of the plans.
To fulfill its responsibilities with regard to these pension plans in the most prudent and appropriate manner, the Board has established a governance structure and established the Pensions Committee as one of its standing committees. It has made the Pensions Committee responsible for the following:
- advising on governance structures for the University’s pension plans; and,
- advising on pension benefit design and approve administrative changes; and,
- establishing funding, investment and related reporting protocols for the plans; and,
- establishing investment policy and procedures for the plans.
The detailing of the responsibilities that follows clarify those matters which have been delegated by the Board to the Pensions Committee for advice or for decision-making. In its decision-making responsibilities, the Pensions Committee is required to act in a manner that satisfies the Board’s fiduciary responsibilities and serves the best interests of the members and retirees of the plans. The Committee is responsible for providing summary reports to the Board on a regular basis, including information about decisions made within its mandate on behalf of the Board.
B. Committee’s Responsibilities Include
1.1 Recommend to the Board the governance structure for the plans, i.e., the committees to be involved in the oversight and administration of the plans and any changes to that structure.
1.2 Recommend to the Board the documented roles and responsibilities for each of the University’s decision-making and advisory bodies involved in the oversight and administration of the University’s pension plans.
1.3 Report to the Board on Committee activities at least annually or when requested.
2. Pension Benefit Design
2.1 Recommend to the Board the design and text of any new pension plans.
2.2 Recommend to the Board any amendments to the design and/or text of existing University pension plans, except for changes provided under 2.3, below and including observations about the financial impact on the University’s costs and related funding requirements.
2.3 Approve administrative changes to the text of the plans which do not affect current or future liabilities of the plans.
2.4 Review recommendations that may come forward from the plans’ pension advisory committees.
3.1 Appoint and monitor the performance of the plans’ actuary.
3.2 Seek advice from the actuary on the frequency of the preparation and filing of actuarial valuations in accordance with legislated requirements and ensure all related reporting requirements are satisfied.
3.3 Review and approve the major actuarial assumptions used by the plans’ actuary in the preparation of actuarial reports.
4. Administrative Responsibilities - Finance
4.1 Appoint and monitor the performance of the custodial trustee of the fund.
4.2 Review and approve the annual audited financial statements of the plans.
4.3 Review the administrative expenses of the pension plans.
5. Administrative Responsibilities - Investment Policy
5.1 Monitor the activities of the Investment Subcommittee (IS) established by the Board and which acts as a subcommittee of the Pensions Committee. The IS’s responsibilities include the review, recommendation, and implementation of detailed investment policies for pension investments, set investment strategy for the pension plans, and appoint and review pension fund investment managers. The IS is accountable to the Pensions Committee in regard to these responsibilities.
5.2 Review and recommend to the Board the Statement of Investment Policies and Procedures (SIP&P), and approve changes as necessary, for the University’s pension plans as recommended by the IS.
5.3 Commission an asset/liability study at least every five years to review the long-term asset mix policy of the pension funds. The IS will be provided with the results of the study to assist it in determining the asset allocation and investment classes and recommending adjustments to the SIP&P, as necessary.
5.4 On at least an annual basis, monitor:
i) Total fund investment performance as reported by the Office of Investment Management on behalf of IS.
ii) Funded status of the plans.
iii) Continued appropriateness of the SIP&P.
iv) General compliance with applicable legislative requirements.
v) Compliance with SIP&P and any other investment policies.
6.1 Review annually the Committee’s mandate and recommend changes as necessary.
6.2 Perform such functions as may from time to time be assigned to the Committee by the Board of Governors.
a) Five non-plan members appointed by the Board of Governors, who shall normally be members of the Board
b) One plan member from the Professional Pension Plan nominated by the University of Guelph Faculty Association (UGFA) and appointed to the Committee by the Board
c) One plan member from the Professional Pension Plan who is not a member of UGFA and is appointed to the Committee by the Board
d) Two plan members from the Retirement Pension Plan appointed to the Committee by the Board
e) One retiree who is a plan member of either the Professional or Retirement Pension Plan, nominated by the University of Guelph Retirees’ Association (UGRA) and appointed to the Committee by the Board
f) Chair, Board of Governors
h) University Secretary or designate of the University Secretary (non-voting)
Board of Governor’s General Bylaw 7.8 provides that quorum for a Board committee is two-fifths of that committee’s membership. In the case of the Pensions Committee, quorum shall be four (4) members, three of whom must be non-plan Board members.
As with other Board committees, each voting member of the committee who is present at a meeting shall be entitled to one vote. However, for the Pensions Committee, in the case of decisions or recommendations for policy changes or amendments affecting the pension plans, agreement of a majority of non-plan Board members is required to carry the motion.
Effective: July 1, 1989
Revised: September 3, 1993*; June 7, 2007; October 2, 2008; April 10, 2014; October 16, 2018
*Revisions made by Board of Governors resolution, September 23, 1993, were as recommended by the Pension Reform Implementation Group established following the preparation of a report by the Presidential Task Force on Pensions.