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Recent volatility and uncertainty, driven by the emergence of geo-political and market risks, has driven central bankers across the globe to revert to ultra-low or even negative interest rate policies, to calm economic concerns. The constrained rate environment however has impacted greatly on pension sponsors balance sheets and pension plans overall investment returns, driving many to explore innovative strategies, new asset classes and sector to cope with an emerging negative cashflow environment.

The sixth annual Pension Plan De-Risking, North America report brings together U.S. and Canadian based pension plans and corporate sponsors to examine current drivers for de-risking of pension plans. Issues to be discussed include liability driven investing, bulk buy-outs and risk management technology.

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Understanding the risks and strategies for successfully de-risking a pension plan

FOREWORD

De-Risking is Not a Waiting Game: After Another Year of Optimistic Hopes and Sideways Progress, Proactive De-Risking Looks Even Smarter

• Francois Pellerin, LDI Strategist, Fidelity Institutional Management

• Dan Tremblay, Director of Institutional Fixed Income Solutions, LDI Strategist, Fidelity Institutional Asset Management

SECTION 1

DE-RISKING AND ITS CONSEQUENCES

1.1 INTERVIEW: Ten years on from the Pension Protection Act…where are we today?

Interviewer:

• David Grana, Report Publisher, Clear Path Analysis

Interviewee:

• Patrick Baumann, Treasurer, Harris Corporation

1.2 INTERVIEW: What are the drivers behind the recent increase in pension buyouts and what does it mean for insurance supply and pricing?

Interviewer:

• David Grana, Report Publisher, Clear Path Analysis

Interviewee:

• Lynn Esenwine, Partner and Senior Pension Risk Transfer Consultant, Mercer

1.3 INTERVIEW: Is liability-driven investing still the most effective mainstream strategy for reducing plan sponsors funding gaps through investment activity?

Interviewer:

• David Grana, Report Publisher, Clear Path Analysis

Interviewee:

• Brad Smith, Partner, New England Pension Consultants

1.4 INTERVIEW: Could pension buyouts be the solution to the great public pension funding gap in America?

Interviewer:

• David Grana, Report Publisher, Clear Path Analysis

Interviewee:

• Dr. Mark J. Warshawsky, Senior Research Fellow, Mercatus Center of George Mason University

SECTION 2

ASSET MANAGEMENT STRATEGIES

2.1 WHITEPAPER: Weatherproofing a plan’s return-seeking assets

• Amy Trainor, FSA, Multi-Asset Strategist and Portfolio Manager, LDI Team Co-Chair, Wellington Management

2.2 INTERVIEW: What impact does de-risking have on the stability of the Pension Benefit Guarantee Corporation and its ability to provide insurance for pension plan sponsors?

Interviewer:

• David Grana, Report Publisher, Clear Path Analysis

Interviewee:

• Ted Goldman, MAAA, FSA, Senior Fellow, American Academy of Actuaries

2.3 INTERVIEW: How has the corporate pension industry evolved over a 38-year career, and where is it heading – what does the future hold?

Interviewer:

• David Grana, Report Publisher, Clear Path Analysis

Interviewee:

• Ray Kanner, Chief Investment Officer (retired), IBM, Member, Committee on Investment of Employee Benefit Assets (CIEBA)

2.4 INTERVIEW: Stemming the bleeding – what pension funds are doing to solve the issue of negative cash-flow

Interviewer:

• David Grana, Report Publisher, Clear Path Analysis

Interviewee:

• Aoifinn Devitt, Chief Investment Officer, Policemen’s Annuity and Benefit Fund of Chicago

2.5 INTERVIEW: The alternative method: Using a multi-asset approach to increasing funding levels

Interviewer:

• David Grana, Report Publisher, Clear Path Analysis

Interviewee:

• Brian Reed, Director, Retirement Plan Assets, CSRA Inc.

SECTION 3

EXECUTION STRATEGIES AND RISK MANAGEMENT

3.1 INTERVIEW: Case Study: Steps taken to execute the recent C$350 million Loblaw annuity buyout.

Interviewer:

• David Grana, Report Publisher, Clear Path Analysis

Interviewees:

• John Poos, Group Head, Pensions and Benefits, George Weston Limited

• Marco Dickner, Retirement Practice Leader, Willis Towers Watson

3.2 INTERVIEW: What are some of the litigation risks associated with pension de-risking that plan sponsors should prepare for?

Interviewer:

• David Grana, Report Publisher, Clear Path Analysis

Interviewee:

• Markus Kremer, Commercial Litigation Group, Borden Ladner Gervais

Patrick Baumann

Treasurer, Harris Corporation

Lynn Esenwine

Partner and Senior Pension Risk Transfer Consultant, Mercer

Brad Smith

Partner, New England Pension Consultants

Mark Warshawsky

Senior Research Fellow, Mercatus Center of George Mason University

Ted Goldman

MAAA, FSA, Senior Fellow, American Academy of Actuaries

Ray Kanner

Retired - Managing Director and Chief Investment Officer, IBM

Aoifinn Devitt

Chief Investment Officer, Policemen’s Annuity and Benefit Fund of Chicago

Brian Reed

Director, Retirement Plan Assets, CSRA Inc.

John Poos

Group Head, Pensions and Benefits, George Weston Limited

Marco Dickner

Retirement Practice Leader, Willis Towers Watson

Markus Kremer

Commercial Litigation Group, Borden Ladner Gervais

Amy  Trainor

FSA, Multi-Asset Strategist and Portfolio Manager, LDI Team Co-Chair, Wellington Management

François Pellerin

LDI Strategist, Fidelity Institutional Asset Management

Dan Tremblay

Director of Institutional Fixed Income Solutions, LDI Strategist, Fidelity Institutional Asset Management

Fidelity Institutional Asset Management (FIAM) is one of the largest investment management organizations serving the U.S. institutional marketplace*. FIAM serves financial advisors and advisory firms, offering them resources to help investors plan and achieve their goals. FIAM also works with institutional investors and consultants to meet their varying and custom investment needs. FIAM provides actionable strategies, enabling its clients to meet their investment mandates and is a gateway to Fidelity Investment’s original insight and diverse investment capabilities across equity, fixed income, high‐income, and global asset allocation.

*FIAM is a division of Fidelity Investments. Fidelity Investments has assets underadministration of $5.6 trillion, including assets under management of $2.0 trillion as of December 31, 2016.

Wellington Management is an investment adviser to more than 2,150 institutions in over 65 countries. Our mission as a firm is simple: to exceed the investment objectives and service expectations of our clients worldwide. With US$1 trillion in client assets under management*, we offer a broad range of equity, fixed income, alternative, and multi-asset investment approaches.
www.wellington.com (*Figures as of 30 March 2017)

By listening to those in the industry, we create a shortlist of individuals who most influence and inspire those around them and invite them to contribute to our reports and events by:

Contributing a thought piece on an issue raised in the market research

Participating in or moderating a roundtable with other industry leaders

Participating as an interviewer or interviewee

Producing a case study white paper written with a client or supplier

Taking part in a head to head debate with another respected industry professional.

Clear Path Analysis is always open to suggestions of suitable contributors for future topics.

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Savvy Investor is the world’s leading “knowledge network” for institutional investors, curating the best pensions and investment white papers from around the web and tailoring research to the interests of individual members. Launched in March 2015, the site has grown rapidly, with a membership consisting primarily of pension funds, asset owners, investment managers and investment consultants.

The Fixed Income Leaders Summit is taking place on May 16 - 18, 2017 at Westin Copley Place, Boston and will be the only meeting place for the most influential buy side heads of trading for credit & rate. With 250+ of the most influential Heads of Fixed Income Trading and Portfolio Management from the top US buy side firms all under one roof at one time, this is your opportunity to benchmark your business with those that are best adapting to the new landscape.Agenda: http://bit.ly/2ksmiKd


Opal Group’s annual public funds conference addresses issues that are critical to the investment success of senior public pension fund officers and trustees in the new millennium. Concerns of funding liabilities for beneficiaries in a world of declining returns yet maintaining a balance between the risk/ reward paradigms is center in the mind of many trustees and representatives of pension plans around the country. By focusing on an atmosphere of education rather than sales or marketing, the Public Funds Summit provides a unique environment in which members of the public sector can exchange ideas and learn from other delegates, money managers and consultants. Opal will kick off the event with its Annual Regatta Cup, in which attendees will have the opportunity to work with a professional sailing charter crew while competing against industry peers.