Climate Change Its Science, Politics, and Implications for Pension Fund Management

Transcription

1 Climate Change Its Science, Politics, and Implications for Pension Fund Management Risk Management after the Financial Crisis Regulatory and Pension Fund Responses around the World Tomorrow s Pension Fund Perspectives from the United Kingdom, Sweden, and Australia KEY FORUM INSIGHTS AND POSSIBLE ACTION STEPS July 2010 A Discussion Forum Sponsored by Rotman ICPM Co hosted by the Danish Labor Market Supplementary Pension Plan (ATP) Held at the Copenhagen Business School October 12 14, 2010 Organization of this Document 1. Key Forum Insight and Conclusion Highlights 2. ICPM October 2010 Discussion Forum Agenda 3. Pre Forum Discussions and Conclusions Summary 4. Climate Change Discussions and Conclusions Summary 5. Risk Management Discussions and Conclusions Summary 6. Tomorrow s Pension Fund Discussions and Conclusions Summary 7. Participant Feedback on Forum and Suggestions for Future Topics 8. Forum Attendee List 9. Draft Agenda for the May 2011 Forum in Toronto Note: all PowerPoint materials from the event are available on the ICPM website ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 1 of 15

2 Key Forum Insight and Conclusion Highlights The Key Forum Insights and Conclusions come in four parts. Part 1 is based on the pre Forum sessions on Tuesday, October 12. Part 2 is based on the Climate Change sessions on Wednesday, October 13, and Parts 3 and 4 on the Risk and Tomorrow s Pension Fund sessions on Thursday, October 14. Part 1: Pre Forum ICPM continues to build its portfolio of Research Partner services. Seven new research projects have been funded. We are now producing interviews with authors of some of the key impact articles published in the Rotman International Journal of Pension Management. A week long Board Workshop on Pension Governance is being created for roll out late November The dates and locations of the 2011 Discussion Forums were announced (May 16 18, Toronto and October 17 19, Washington D.C.). Part 2: Climate Change According to James Cameron and Lykke Friis, both the science and politics of climate change are compelling, and the issue should be on the radar screens of the globe s thought leading pension funds. Reaching international consensus on climate change policy has been a difficult process, and is unlikely to get any easier. Meanwhile, however, pension funds should actively be identifying bottom up risks and opportunities The climate change Case Study generated animated debate and discussion, but no clear consensus on how the CEO of the CRIPP fund should proceed. There was, however, consensus that the CRIPP fund does need an action plan of some sort to deal with emerging climate change issues. Representatives from five leading pension funds (all ICPM Research Partners) reflected the diversity of views that emerged through the Case Study debate and discussions. Two of the five funds have seriously committed to integrate climate change considerations into all of their investment decisions, two are in the process of doing so, and the fifth fund is studying how to proceed. The Mercer climate change study uses multiple scenarios and factor analysis to shed new light on the risks and opportunities embedded in the dynamics of climate change. ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 2 of 15

3 Part 3: Risk A survey by CEM Benchmarking Inc. suggests pension funds are taking an uneven approach to risk management. Some have dedicated risk management groups and take a comprehensive approach.others much less so. The Financial Crisis has raised some troubling questions about the Dutch collective DC system. Are property rights well enough defined? Are the governance and risk management structures sturdy enough? Strong measures to address these questions are now being debated, and could be implemented soon. The Danish pension system seems to have fared better, probably for three reasons: 1) clearly defined pension contracts, 2) strong regulatory hands, and 3) expert risk management protocols. The Financial Crisis has caused many North American pension funds to have a closer look at their risk management protocols. Greater emphasis is now placed on bringing the identification and management of all types of risks under one common risk management roof, with a direct linkage to the Board. The video Risky Business and the Business of Risk showed that a dash of humor can help communicate the importance managing the risks in our lives. Part 4: Tomorrow s Pension Fund Peter Drucker s 1976 book The Unseen Revolution argued for the birth of strong pension institutions with aligned interests, good governance, sensible investment beliefs, scale, and competitive compensation. The quest to create such pension institutions continues around the world. The current situations in the UK, Sweden, and Australia offer graphic examples. The UK needs them as it looks to expand the reach of its supplementary retirement system. Sweden needs to sharpen the focus and effectiveness of its national AP buffer funds through their consolidation into one super fund. Australia has to deliver pensions to its workers at lower cost, and design retirement savings accumulation/decumulation formulas which recognize that workers are choosing not to choose. More effective pension institutions are keys to bringing these changes about. ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 3 of 15

4 ICPM OCTOBER 2010 DISCUSSION FORUM Tuesday, October 12 through Thursday, October 14, 2010 Pre Forum Activity Location: Admiral Hotel, Copenhagen, Denmark Conference Location: Copenhagen Business School, Frederiksberg, Denmark Pre Forum Activities Tuesday, October 12 (optional or by invitation only sessions) ADMIRAL HOTEL 1:00 2:15pm 2:45 4:00pm 4:30 5:30pm Funds Networking Session (limited to those with fund management responsibilities only) Topic: Participant driven (pre reading material available for this session) Location: Admiral Hotel Harbour Room III (go through SALT Restaurant, room overlooks harbour) Moderator: ATP ICPM Information Session (open to all) Location: Admiral Hotel Harbour Room III (go through SALT Restaurant, room overlooks harbour) Moderator: Keith Ambachtsheer Topics: Research Partner Update Fall 2010 Issue of the Rotman International Journal of Pension Management NEW Author Video Series NEW ICPM Website Progress Report on ICPM Research Projects Update on ICPM Professorship Research Partner Survey Feedback 2011 Forum Agenda Ideas / Locations Case Study Topics Board and Research Committee Meeting (for board and committee members only) Details will be provided separately. 6:30pm onward Welcome Reception Wednesday, October 13 CLIMATE CHANGE: RISKS AND OPPORTUNITIES COPENHAGEN BUSINESS SCHOOL 8:15 8:45am 8:45 9:00am 9:00 11:30am Light Breakfast Available / Name Badge and Materials Pickup Keith Ambachtsheer and Ann Henhoeffer, Rotman ICPM Co Host, Lars Rohde, CEO, ATP Opening Remarks and introduction of first speaker The Granularities of Climate Change and Climate Finance James Cameron, Vice Chairman of Climate Change Capital, United Kingdom Lykke Friis, Minister of Climate Change and Energy, Denmark and Chair of the COP process COP15 in Copenhagen did not provide a global agreement and rumors say that COP16 in Cancun this fall will be no different. What should we expect from Cancun and beyond? Analysis point out that 85% of the financing needed in the combat of climate change must come from private sources. The combat of climate change is won or lost in the hands of private investors. What is required for investors to assume this critical role and how are they best assisted? Q&A for all participants. 11:30am 2:30pm Case Study 4 Climate Change and Pension Funds: Risk, Opportunity, or Distraction? Rob Bauer, University of Maastricht, Netherlands A new Case Study on climate change has been commissioned for this Forum. As with previous Case Studies, it will involve reading the Case Description ahead of time, participating in both large and small ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 4 of 15

5 group discussions on the issues presented in the Case, and reaching consensus on the way forward. Lunch will be available during the small group discussions. Includes Working Lunch. 3:00 4:30pm 4:30 5:30pm Current Climate Change Related Policies and Implementation Strategies How do investors in different countries interpret the risks and opportunities posed by climate change and what are the implications? Brief presentations by Ole Beier Sørensen (ATP, Denmark), Rob Lake (APG, Netherlands), David Russell (USS, United Kingdom), Stephen Lerch (Washington State Investment Board, United States), and Gordon Hagart (Australia Future Fund). To be followed by a round table discussion. Mercer Climate Change Study Danyelle Guyatt, Mercer, United Kingdom Mercer has been leading a major Climate Change Study for a group of institutional investors, which include a number of ICPM Research Partners. Danyelle will provide a brief outline of the Study's framework and a sneak preview of some of its key findings. She will also share the findings of a recent study on institutional investor 'short termism'. 7:00pm onward Networking Dinner Thursday, October 14 Theme #1: RISK MANAGEMENT AFTER THE FINANCIAL CRISIS COPENHAGEN BUSINESS SCHOOL Morning Break 10:15 10:45am / Lunch at The Kilen (Kilivej 14A) 12:15 1:15pm / Afternoon Break 3:00 3:20pm 7:45 8:15am Light Breakfast Available 8:15 9:00am Mike Heale, CEM Benchmarking Inc., Canada CEM conducted a post crisis survey of its pension fund clients around the globe on their risk management attitudes and priorities. Mike will share the findings of the survey with Forum participants. 9:00am 12:15pm Responses to the Financial Crisis in the Netherlands, Denmark, and North America This will be a highly interactive panel discussion that will unfold in three parts. Part I Dutch Responses to the Financial Crisis Jan Nijssen was a member of the commission formed by the Dutch Government to study the governance and risk management practices of Dutch pension funds before, during, and after the crisis. He will discuss the commission's findings. Niels Kortleve will report on how PGGM and other Dutch funds are rethinking 'the pension deal' in light of the crisis. Peter Vlaar of APG will assess the performance of ALM models during the crisis and discuss the post crisis implications for their design. Part II Danish Responses to the Financial Crisis Henrik Bjerre Nielsen is CEO of the Financial Stability Company in Denmark. Before joining FSC in 2008, he was the Director General of the Danish Financial Services Authority for 10 years. Henrik will discuss Denmark's move to a 'fair value' based (i.e., marked to market) regulatory regime and provide a regulator's perspective on the lessons learned through the Financial Crisis. Bjarne Graven Larsen is CIO of ATP, and he will describe ATP's response to the new regulatory environment, and how ATP fared through the Financial Crisis. Part III North American Responses to the Financial Crisis The Chief Risk Officers of two major North American funds, Barbara Zvan of Ontario Teachers' Pension Plan and Erwin Martens of TIAA CREF, will offer their 'lessons learned' perspectives. ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 5 of 15

6 Theme #2: TOMORROW S PENSION FUND 1:30 2:00pm Keith Ambachtsheer, Rotman ICPM, Canada Why is this topic of fundamental importance? What do we already know about tomorrow s pension fund? 2:00 2:45pm 2:45 3:00pm 3:20 4:15pm 4:15 5:00pm David Pitt Watson, Hermes and The Royal Society (RSA), United Kingdom David has been leading a project sponsored by the RSA on tomorrow s pension fund. He will report on where the project stands, and where it could go from here in light of the new political environment in the United Kingdom. Malin Björkmo, Financial Supervisory Authority, Sweden Prior to taking on her current FSA responsibilities, Malin was commissioned to study the structure of Sweden s AP buffer funds. She will discuss her controversial findings and recommendations. Jeremy Cooper, Chair, Superannuation Review, Australia The Australian Government constituted the Superannuation Review a year ago to see what could be done to improve the cost effectiveness of the Australian pension (super) system. Jeremy will share the Review s findings and recommendations and place them in an international setting. Wrap Up Discussion What did we learn today? What are its implications? ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 6 of 15

7 SESSION SUMMARIES ICPM Information Session Keith Ambachtsheer reported that ICPM s plans for FYs 2010/11 and 2011/12 are on track. The Fall 2010 issue of the Rotman International Journal of Pension Management has just been published, and the editorial lineup for Spring 2011 is falling into place. Alexander Dyck has been appointed the inaugural ICPM Professor of Pension Management at the Rotman School of Management, University of Toronto. He is currently doing research on the scale factor in fund management, will participate in the May 2011 Forum in Toronto, and is advising on the ICPM Governance Workshop for Pension Fund Board Members being designed for roll out in late November ICPM currently has 26 Research Partners, with a target of 30 for The Discussion Forums in 2011 will be at the Rotman School in Toronto May 16 18, and in Washington DC October 17 19, co hosted by the World Bank. Ann Henhoeffer reported that the ICPM Website will receive a major upgrade. One reason is that we have begun to produce 10 minute video interviews with the authors of some of the high impact articles published in the Journal to date. As an example, Keith s interview with former CEO Claude Lamoureux of Ontario Teachers was shown (on strategic management). Interviews with Rob Bauer (on performance measurement), Jan Bertus Molenkamp (on performance based compensation), and Ed Waitzer (on governance) have also been taped, with more to come. Stefan Lundbergh, Chair of the ICPM Research Committee reported that the seven new research projects selected for funding earlier this year are now all underway. He expects to be able to provide brief progress reports at the next Information Session (May 16, 2011 in Toronto). Keith announced that Rob Bauer will play a greater role in ICPM affairs in 2011, organizing the agendas for the Spring and Fall Forums, and also for ensuring that Case Study 5 will be ready for debate and discussion at the Fall Forum. Rob led a discussion of possible topics for Case Study 5. A number of interesting topics resulted, including in the areas of rethinking investment beliefs (e.g., the role of dynamic asset allocation), building functional pension fund governance boards, the challenges of communicating effectively with stakeholders, and collaboration strategies between pension funds that achieve the desired results. ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 7 of 15

8 Climate Change Session James Cameron, a senior advisor on climate change policies at both the national and international levels kicked things off. He provided a tour de force through the development of international climate negotiations from the 1992 Earth Summit in Rio de Janeiro, the Kyoto protocol, the Bali Road Map, and finally COP15 in Copenhagen. COP 15 was a disappointment, and expectations should be set at a more realistic level for COP16 in Cancun. There will be no global deal in Cancun, but possibly advances on a variety of subtopics. Investors require policy stability and this has not been forthcoming. This translates directly into a weakened investor appetite. Danish Minister of Energy and Climate Change Lykke Friis (also Chair of the COP Process) noted that considerable work is still needed to make progress at COP16 in Cancun. A comprehensive global agreement remains the final objective. Cancun must anchor key elements of the Copenhagen Accord, leading to a balanced "Cancun package" of collective actions. Meanwhile, "bottom up" processes are important too (e.g., carbon markets, financing mechanisms). The High Level Advisory Group on climate finance is looking at potential sources to reach the US$100 billion by While we wait for the global deal, there must be momentum at the local and the regional levels. A new green fund to leverage private finance is needed. All this points to a strong need to strengthen the investor climate change policy dialogue. Case Study 5 titled Climate Change and Pension Funds: Risk, Opportunity, or Distraction? produced some interesting debate and discussion. Participants took the climate change issue seriously, but disagreed on where it fit in the Canadian Resources Industry Pension Plan s priorities, organization, and business plan. That disagreement was there at the start and did not get resolved as the matter went to small group discussions. The ultimate resolution lies in sorting out where the climate change issue fits into CRIPP s organization mission, its investment beliefs, and its organizational priorities. This will eventually require the involvement of both Management and the Board. Case Study Overview can be accessed via the following link Reading/ICPM%20Case%204_Climate%20Change%20and%20Pension%20Funds_FINAL_September%2024% (1).pdf What are thought leading funds actually doing on the climate change file? Representatives of five ICPM Research Partner funds offered answers, which ranged all the way from a great deal (e.g., Rob Lake at APG, Ole Beier Sorensen at ATP), to a considerable amount (e.g., Gordon Hagart at Australia Future Fund, David Russell at USS), to a more measured we are seriously looking at this issue (Stephen Lerch at WSIB). Rob Lake PowerPoint ob%20lake.pdf ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 8 of 15

9 The session ended with a sneak preview offered by Danyelle Guyatt at the findings of a major Climate Change study being conducted by Mercer. A framework that includes both multiple scenarios and the use of risk factors predicts that climate change will likely impact pension fund returns materially in a multi decade timeframe. The study offers new perspectives on both novel diversification strategies and on emerging investment opportunities. Risk Management after the Financial Crisis Mike Heale set the stage by sharing the results of a survey of 58 funds (average value $32B) conducted by CEM Benchmarking Inc. Less than half the sample currently measure and manage surplus risk, despite it being ranked 10x more significant than active management risk. Half of the funds had dedicated risk management groups, with considerable variance in the size of those groups. Mike Heale PowerPoint Mike%20Heale_Sept%201.pdf Jan Nijssen described the work of two commissions created by the Dutch government in response to the financial crisis. Recommendations coming out of their work included the need to create greater clarity about current Dutch pension contracts, and to enhance their sustainability. On the governance and risk management sides, funds need to raise their expertise levels. Niels Kortleve reported on how PGGM is actually responding to these recommendations, and Peter Vlaar explained how the crisis has led APG to rethink the design of its ALM modeling process. Jan Nijssen PowerPoint an%20nijssen.pdf Niels Kortleve PowerPoint Niels%20Kortleve.pdf Peter Vlaar PowerPoint etervlaar.pdf Henrik Bjerre Nielsen explained how Denmark was one of the first countries to move to fair value based accounting and regulations in its pensions sector while he was head of its Financial Services Authority. He suggested this gave the country an important first mover advantage when faced with the 2008 crisis. Bjarne Graven Larsen confirmed this by describing how ATP emerged from the financial crisis relatively unscathed. Two of the keys were 1) a clear pension accumulation formula with well defined risk free and at risk components, and 2) a strong balance sheet management discipline to ensure risk exposures did not exceed risk budgets. Bjarne Graven Larsen jarne.pdf ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 9 of 15

10 Erwin Martins and Barbara Zvan, the Chief Risk Officers of TIAA CREF and Ontario Teachers respectively, offered lessons learned perspectives from North America: taking an overall enterprise risk management approach, pulling the activities and information of differing functional groups within the organization together, and creating a direct interface/connection between the organization s risk group and the Board. Barbara Zvan PowerPoint arbara%20zvan.pdf The session ended with the screening of the video Risky Business and the Business of Risk, the Monty Python perspective on risk management. The video was produced by the risk manager Cardano to celebrate its 10th Anniversary. All attendees have been sent a DVD copy of the video. Tomorrow s Pension Fund (TPF) Keith Ambachtsheer introduced the TPF topic, noting that the idea originated with Peter Drucker in his 1976 book on the political economy of pensions titled The Unseen Revolution. Drucker wrote that the pensions sector would need strong pension institutions to remain independent of such strong outside forces as government, business, unions, and the financial services industry. Logic and research have since confirmed that successful pension institutions have 5 drivers: aligned interests, good governance, sensible investment beliefs, right scaled, and competitive compensation. Keith Ambachtsheer PowerPoint mbachtshee.pdf David Pitt Watson gave an update of his work with the venerable Royal Society (RSA) in the United Kingdom. The vision is to introduce more TPF type pension institutions into the United Kingdom with the 5 success drivers. The current challenge is to align that vision with current political developments, especially with the introduction of pension plan autoenrolment legislation and the new National Employee Savings Trust (NEST). He believes that already existing organizations such as APG and ATP could play important roles in turning the TPF vision into reality. David Pitt Watson PowerPoint id%20ptt Watson%20Slides%20_NEW.pdf Malin Bjorkmo summarized the findings of her study of Sweden s AP buffer funds. She recommends their consolidation into a single fund, with focus on ensuring that this consolidated $100B fund can meet the 5 success drivers test, especially the good governance requirement. Her study has created significant controversy in Sweden, with the new government apparently interested pursuing the report s recommendations. Malin Bjorkmo PowerPoint Malin%20Bjorkmo.pdf ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 10 of 15

11 Jeremy Cooper summarized the findings and recommendations of his study of Australia s mandatory DC oriented superannuation system. The system is too expensive, and must become more reflective of the needs of its millions of participants. This means taking account of the reality that most workers are choosing not to choose. Thus a key report recommendation is that every superannuation plan on offer must have a MySuper default option which meets certain standard requirements such as unbiased governance and low cost. Jeremy Cooper PowerPoint Jeremy%20Cooper.pdf Participant Feedback on Forum and Suggestions for Future Topics Did the October 2010 Forum meet attendees overall expectations? On an excellent / good / poor grid the Forum was ranked 20 / 15 / 0. This is in line with previous Forum rankings (e.g., 21 / 13 / 0 for the June 2010 Forum). What You Liked Great conference. Hard driving agenda packed with good content. This was my second Forum, and was as impressed as the first time. The ICPM Forums continue to be the best industry platform for open debate on key issues. Good content, good format, good length. Very well organized! Great quality consistent every time well done! Suggestions for Improvement Longer breaks/more networking time Maintain strong academic/research dimension Use interactive response technology Make physical surroundings more conducive to open debate and discussion Give SRI topics a rest Future Forum Topics Pension design challenges (e.g., how to adjust to rising longevity/falling interest rates scenario, optimal risk sharing arrangements, goals of pension regulation) Stakeholder communication challenges (e.g., about the pension promise, about how/by whom risk is being borne) Pension fund governance challenges (e.g., modernization of fiduciary duties, the representative vs. expertise/experience selection dilemma for Board members, the role of leadership, dealing with behavioral issues, compensation policy) Rethinking investment beliefs and investment policy (e.g., dynamic asset allocation, risk budgeting, risk modeling and metrics based on fundamental factors, consistent approaches to investing in public and private markets, venture investing, effective ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 11 of 15

12 linkages to compensation through benchmarking approaches that are defensible and transparent, sorting out useful and useless investment theories) Effective collaboration between funds (e.g., on shareowner stewardship, on performance measurement, benchmarking, and compensation policy, on integrating ESG issues into mainstream investing, on solving common wicked problems) ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 12 of 15

13 Attendee List October 2010 Discussion Forum Full Name Organization Country Leo de Bever AIMCo Alberta Investment Management Corp. Canada Grant Howell Alberta Local Authorities Pension Plan Corp Canada Laurence Waring Alberta Local Authorities Pension Plan Corp Canada Rob Lake Algemene Pensioen Groep (APG) The Netherlands am.nl Stefan Lundbergh Algemene Pensioen Groep (APG) The Netherlands am.nl Peter Vlaar Algemene Pensioen Groep (APG) The Netherlands am.nl Gordon Hagart Australia Future Fund Australia Jeremy Cooper Australia Super System Review Australia Katrina Ellis Australian Prudential Regulation Authority (APRA) Australia Raj Thamotheram AXA Investment Management UK Limited United Kingdom im.com] Nigel Labram BT Pension Scheme Management Ltd. United Kingdom Faouki Majeed CalPERS USA Herman Bril Cardano Risk Management The Netherlands Mike Heale CEM Benchmarking Canada Melda Donnelly Centre for Investor Education Australia Sean Kidney Climate Bonds Initiative United Kingdom James Cameron Climate Change Capital United Kingdom c capital.com Susse Georg Copenhagen Business School Denmark Nis Hoyrup Christensen Copenhagen Business School Denmark Michael Møller Copenhagen Business School Denmark Peter Mollgaard Copenhagen Business School Denmark Mette Monsted Copenhagen Business School Denmark Jesper Rangvid Copenhagen Business School Denmark Mads Stenbo Nielsen Copenhagen Business School Denmark Duncan Wigan Copenhagen Business School Denmark Syd Bone CP2 Limited Australia Don Raymond CPP Investment Board Canada Henrik Ramlau Hansen Danica Denmark Ole Beier Sørensen Danish Labour Market Supplementary Pension (ATP) Denmark Chresten Dengsoe Danish Labour Market Supplementary Pension (ATP) Denmark Lars Rohde Danish Labour Market Supplementary Pension (ATP) Denmark Bjarne Graven Larsen Danish Labour Market Supplementary Pension (ATP) Denmark Michael Preisel Danish Labour Market Supplementary Pension (ATP) Netherlands Ulla Schjoedt Hansen Danish Labour Market Supplementary Pension (ATP) Denmark Dirk Broeders De Nederlandsche Bank The Netherlands Henrik Bjerre Nielsen Finansiel Stabilitet Denmark Timo Löyttyniemi Finland State Pension Fund / Valtion Eläkerahasto Finland timo.loyttyniemi@ver.fi Jim Keohane Healthcare of Ontario Pension Plan (HOOPP) Canada jkeohane@hoopp.com David Pitt Watson Hermes Focus Asset Management (HFAM) United Kingdom d.pitt watson@hermes.co.uk Marlon Sahetapy Hermes Pensions Management Limited United Kingdom M.Sahetapy@hermes.co.uk ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 13 of 15

14 Stephanie Pfeifer IIGCC (c/o The Climate Group) United Kingdom Rob Bauer Maastricht University Netherlands Jan Nijssen Member of the National Commission on Pension Fund The Netherlands Investment Policy and Risk Management Susanna Jacobson Mercer Denmark Danyelle Guyatt Mercer Investment Consulting (UK) United Kingdom Lykke Friis Ministry of Denmark Denmark Lars Hassel Mistra Sweden Tim Mitchell New Zealand Superannuation Fund New Zealand Sadayuki Horie Nomura Research Institute Japan s horie@nri.co.jp Petri Kuusisto Northern Star Partners The Netherlands petrikuusisto@msn.com Graham Pugh Ontario Municipal Employees Retirement System (OMERS) Canada gpugh@omers.com Barbara Zvan Ontario Teachers' Pension Plan Board (OTPP) Canada barbara_zvan@otpp.com Deborah Ng Ontario Teachers' Pension Plan Board (OTPP) Canada deborah_ng@otpp.com Fiona Stewart Organisation for Economic Co Operation and Development France fiona.stewart@oecd.org Henrik Heideby PFA Denmark hby@pfa.dk Marcel Jeucken PGGM The Netherlands marcel.jeucken@pggm.nl Jaap van Dam PGGM The Netherlands Jaap.van.Dam@pggm.nl Niels Kortleve PGGM The Netherlands niels.kortleve@pggm.nl Rogér Otten Philips International/Corporate Pensions The Netherlands roger.otten@philips.com Peter Damgaard Jensen PKA Denmark pdj@pka.dk Keith Ambachtsheer Rotman ICPM Canada keith@kpa advisory.com Ann Henhoeffer Rotman ICPM Canada icpm@rotman.utoronto.ca John Battams SunSuper Australia jbattams@qtu.asn.au Tony Lally SunSuper Australia tony_lally@sunsuper.com.au Malin Bjorkmo Swedish Financial Services Authority (FSA) Sweden malin@bjorkmo.com Hans Snijders Syntrus Achmea Asset Management The Netherlands Reijo Vanne The Finnish Pensions Alliance Finland reijo.vanne@tela.fi Erik Valtonen Third Swedish National Pension Fund (AP3) Sweden erik.valtonen@ap3.se Brett Hammond TIAA CREF Investment Management USA bhammond@tiaa cref.org Erwin Martens TIAA CREF Investment Management USA emartens@tiaa cref.org David Blitzstein United Food & Commercial Workers Int l Union USA dblitzstein@ufcw.org David Russell Universities Superannuation Scheme Limited United Kingdom drussell@uss.co.uk Jack Gray University of Technology Sydney Australia jackgray08@live.com.au Theresa Whitmarsh Washington State Investment Board USA twhitmarsh@sib.wa.gov Stephen Lerch Washington State Investment Board USA slerch@sib.wa.gov ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 14 of 15

15 DRAFT FORUM AGENDA MAY 16 18, 2011 TORONTO We will start Monday mid morning with the Fund Forum, followed by the ICPM Open Forum. It will end early Wednesday afternoon so that people can catch late afternoon/evening flights. Session I: Scale Economies and Diseconomies The main results of the ICPM funded research project of Andonov, Bauer, Cremers and Eichholtz (Yale/Maastricht) will be presented. They investigate the size investment performance relationship on both the total pension fund level and the individual asset class level. Alexander Dyck (ICPM Professor of Pension Management) will be the paper discussant. Onno Steenbeek (APG) will broaden the scale discussion with his study of the pension administration function. Session II: What Should Pension Funds Say On Pay? Roger Martin (Rotman School of Management) and Lucian Bebchuk (Harvard Law School) present their views on executive compensation. Representatives of institutional investors (Ann Yerger of the Council of Institutional Investors) and executive compensation consultants (Ira Kay, Pay Governance and Mark van Clieaf, MVC Associates) will react to the Martin and Bebchuk propositions, and present their own perspectives. An open forum will follow. Alexander Dyck will moderate this session. Session III: How Should Pension Funds Invest in Private Equity? Ludovic Phalippou (Said Business School, Oxford University), will share his insights on the future of the private equity industry, focusing on organizational challenges and potential diseconomies of scale. He will also discuss the performance and risks of private equity investments in the last few decades. A panel of ICPM Research Partner practitioners will comment on his views and results. The management of infrastructure and real estate portfolios will also be on the agenda. Session IV: Benchmarking Private Markets Investments Actual practices captured in the CEM database will be presented. Keith Ambachtsheer (Director, ICPM) will comment on the still prevailing theory practice gap in this area. Representatives of ICPM Research Partners of various jurisdictions will explain current practices in their own organizations. This session will finish with an open forum on where the pension industry needs to go from here. ICPM October 2010 Discussion Forum Key Findings and Action Items November 2010 Page 15 of 15