ALBERTA PENSIONS SERVICES CORPORATION BOARD OF DIRECTORS MINUTES HELD on Tuesday, September 23, 2014 and Wednesday, September 24, 2014 at the offices of Alberta Pensions Services Corporation, 3 rd Floor Boardroom, 5103 Windermere Blvd. SW, Edmonton, Alberta. DIRECTORS PRESENT: PRESENT AT THE REQUEST OF THE BOARD: A. Mondor (Chair) R. McClean (Vice Chair) B. Andriachuk C. Archibald W. Chapin M. Prefontaine R. Rosychuk G. Sherwin K. Adams, Chief Executive Officer L. Bowering, VP, Policy and Research D. Gartner, VP, Plan Board Secretariat D. Lawrence, VP, Member and Employer Services and Plan Operations V. Ahmad, VP, Business Technology D. Woloshyn, VP, Finance and Compliance T. Janzen, Executive Director, Human Resources Services and Organizational Design D. Halwas, Management Employees Pension Board (MEPB) G. Walker, Local Authorities Pension Plan Board of Trustees (LAPP) S. Amyotte, Corporate Secretary 1. CALL TO ORDER The Chair declared the meeting to be regularly called and properly constituted for the transaction of business at 8:05 am. 1.1 Appointment of a Monitor Mark Prefontaine was appointed as the meeting monitor. 1.2 Consent Agenda The following two items were moved from the consent agenda to the main agenda: Item C, Board Expenditures Item F1, Correspondence That the consent agenda for September 23-24, 2014 be approved as amended. 1.3 Approval of the Agenda That the Board of Directors meeting agenda of September 23-24, 2014 be approved. Minutes Board of Directors Meeting September 23-24, 2014 Page 1 of 5
1.4 Chair s Message The Chair reminded the directors of the Carver Governance Policy workshop scheduled for October 7, 2014. The Chair welcomed two guest participants to the Board meeting, Darlene Halwas and George Walker, who are currently members of the Management Employees Pension Board and Local Authorities Pension Plan Board of Trustees respectively. Roger Rosychuk gave a summary of the ACPM conference he attended in August. APS staff, except the CEO, left the meeting at 8:35 am. 2. CEO REPORT The Board held an in-camera session with the CEO from 8:35 am to 9:35 am. The CEO left the meeting at 9:35 am. The CEO, VPs, Corporate Secretary and C. Ryan, Director-Physical Security and FacilitiesManagement joined the meeting at 9:50 am. 3. STRATEGY 3.1 Strategic Parking Lot The CEO advised the directors that the strategic parking lot will be a standing item on the agenda, and strategic items for discussion can be placed on this list for future discussion. 3.2 Strategic Plan 2015-2019 / Business Plan 2015-2017 The CEO presented the completed Five Year Strategic Plan 2015-2019 for review and approval by the Board. The multi-year plan incorporated the strategic priorities and direction received from the Board at the June 2014 Board Retreat. C. Ryan presented an overview of the Strategic Plan 2015-2019. The proposed Business Plan 2015-2017 framework and budget assumptions for the Board s review and feedback were also presented. APS staff will return to the December board meeting with the completed business plan and budget. That the 2015-2019 Five Year Strategic Plan be accepted as evidence of compliance with CL-3 (Corporate Strategy). HUMAN RESOURCES COMMITTEE The Board resolved into the Human Resources Committee at 10:35 am. The Human Resources Committee Chair assumed control of this portion of the meeting. NEXT GENERATION BOARD PROJECT GOVERNANCE COMMITTEE The Board resolved into the Next Generation Board Project Governance Committee at 1:20 pm. The Committee Chair assumed control of this portion of the meeting. The Board meeting resumed at 3:20 pm, and the Board Chair assumed control of the meeting. 4. BOARD EDUCATION 4.1 CEM Survey Results Bruce Hopkins, Vice President, CEM Benchmarking Inc., presented an executive summary and analysis of the 2013 benchmarking survey results, including the methodology used. This included comparisons of APS costs and service levels relative to its peer group. The data is compiled from APS participation in the CEM benchmarking surveys. CEM (Cost Effectiveness Measurement) is comprised of 73 leading global pension systems and APS peer group consists of eight pension administrators that are closest to our membership size. Participation in the survey not only gives APS access to valuable data, but also provides the opportunity to network and collaborate with its peers. Minutes Board of Directors Meeting September 23-24, 2014 Page 2 of 5
5. DISCUSSION 5.1 Business Plan Quarterly Update The Board reviewed the Q2-2014 corporate scorecard and the updates on the 2014 Business Plan milestones for Q2 and Q3 year-to-date. 5.2 Plan Board Secretariat Transition Proposal Update The VP, Plan Board Secretariat, provided an update on the progress made since June on the transition proposal. Meetings have been taking place with the plan boards and Treasury Board and Finance, and agreements are being drafted. Fundamentally APS will act as an agent for administration items, while strategic planning and decisions remain the responsibility of the plan boards. 5.3 Pension Sustainability Update The VP, Policy and Research provided an update on the status of Bill 9, the Public Sector Pension Plans Amendment Act. APS provided a written submission to the Standing Committee on Alberta s Economic Future in August. Bill 9 has been prorogued, and will not be reintroduced. The implications of Bill 9 not going forward were reviewed. APS is amending its member information communications and websites to reflect the status of Bill 9. APS staff left the meeting at 5:00 pm. 9.1 Monitor s Report This agenda item was moved to the end of the first day as the meeting monitor would not be attending the second day. The Board held an in-camera session. The monitor delivered his report to the Board. M. Prefontaine and G. Walker left the meeting at 5:15 pm. The meeting for September 23, 2014 recessed at 5:15 pm. The Board had a working dinner from 5:30 8:00 pm. The Board meeting resumed at 8:00 am on September 24, 2014 with the Board Chair in control of the meeting. GOVERNANCE COMMITTEE The Board resolved into the Governance Committee at 8:00 am. The Committee Chair assumed control of this portion of the meeting. AUDIT COMMITTEE The Board resolved into the Audit Committee at 9:30 am. The Committee Chair assumed control of this portion of the meeting. The Board meeting resumed at 12:30 pm and the Board Chair assumed control of the meeting. 6. ITEMS FROM CONSENT AGENDA Items C, Board Expenditures, and F1, Correspondence, were moved from the consent agenda in order for the Board to provide some recommendations on these items. Minutes Board of Directors Meeting September 23-24, 2014 Page 3 of 5
7. DECISIONS 7.1 Committee Recommendations The Board considered the recommendations from the Committees and passed the following motions: That, based on the Human Resources Committee recommendations, the Board accept: 1) the following reports as evidence of compliance with CL-3 Corporate Strategy: employee engagement organization design succession planning 2) the annual compensation report as evidence of compliance with CL-8 (Workforce Compensation and Benefits); 3) the findings of the external consultant report; and 4) the following monitoring reports as providing evidence of compliance with a reasonable interpretation of the Board policies for: CL-7.0 (Workforce Capability); CL-8.0 (Workforce Compensation and Benefits); and CL-9.0 (Workforce Employment Conditions). That, based on the Governance Committee recommendations, the Board: 1) approve the updated Board Charter; 2) approve the updated APS Board of Directors Code of Conduct; 3) recommend to the President of Treasury Board and Minister of Finance, the following independent Directors be reappointed to the Board for another three year term: Al Mondor Rosemarie McClean Ward Chapin 4) support, in a letter to the respective nominators regarding the reappointment of: Mark Prefontaine Minister s representative Chris Archibald PSPB Roger Rosychuk SFPB That, based on the Audit Committee recommendations, the Board: 1) approve the Q2-2014 Quarterly Report to the President of Treasury Board and Minister of Finance, including the unaudited financial statements and Statement of Pension Plan Transactions; and 2) accept the following monitoring reports as providing evidence of compliance with a reasonable interpretation of the Board policies for: CL-4.0 (Risk Management); CL-6.0 (Financial Management); and CL-10.0 (Contract and Project Management). 4. MONITORING REPORTS The Board reviewed the monitoring reports for the Ends and CEO Limitation Policies. EP-1 Financial and Compliance Management The Board reviewed EP-1 and supporting information and noted the report is non-compliant in three instances. Minutes Board of Directors Meeting September 23-24, 2014 Page 4 of 5
EP-2 Pension Plan Information Management The Board reviewed EP-2 and noted the report as non-compliant due to pension payroll and corporate records administration. There are accepted action plans in place to remediate the areas of deficiency, including policy and process changes. EP-3 Beneficiaries The Board reviewed EP-3 and noted the report as non-compliant due to issues with the service standards reporting. The implementation of new technology in 2015 will remediate the area of deficiency. EP-4 Employers EP-5 Plan Governors EP-6 Plan Trustee Global Executive Constraint CL-2 Communication and Support to the Board CL-11 Information and Technology Management The Board reviewed the Log of Non-compliant Items which documents non-compliance from the current and previous monitoring reporting. After discussion, the following motion was passed: That the Board accept the following monitoring reports as providing evidence of compliance with a reasonable interpretation of the relevant Board policy and noting the non-compliant items: EP-1 (Financial and Compliance Management); EP-2 (Pension Plan Information Management); EP-3 (Beneficiaries); EP-4 (Employers); EP-5 (Plan Governors); EP-6 (Plan Trustee); Global Executive Constraint; and CL-2 (Communication and Support to the Board); and CL-11 (Information and Technology Management) 9. IN-CAMERA SESSION (The Board declined the option to hold an in-camera session.) 9.1 Monitor s Report (This item was moved to follow Item 5.3) 9.2 Board Meeting Evaluation Directors were requested to complete the meeting evaluation form. The Chair declared the meeting length to be 12 hours for September 23 and 4.75 hours for September 24. TERMINATION There being no other business, the meeting terminated at 12:45 pm. [original signed by] Chair of the Board [original signed by] Corporate Secretary December 10, 2014 Minutes Board of Directors Meeting September 23-24, 2014 Page 5 of 5