Pension Investment Committee

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Terms of Reference

The Pension Investment Committee (the "committee") is a subcommittee of the Pension & Benefits Committee that oversees the investment of the assets of the University of Waterloo Pension Plan for Faculty & Staff ("the Plan"). 

1. Mandate

The committee is mandated to oversee the investments of the Plan recognizing that (a) the Plan is funded through employee and employer contributions and (b) investment decisions are based on a full understanding of the underlying liabilities, within acceptable risk tolerances, and also being mindful of the fees incurred by the Plan.

2. Membership

The membership of the committee shall be appointed by the Board of Governors on the recommendation of the Governance Committee and shall include voting and non-voting members from the following constituencies:

a. Three (3) voting members appointed from the Board of Governors, with pension risk management and/or investment expertise, of which at least one (1) member will be a member of the Finance and Investment Committee

b. Two (2) voting members having pension risk management and/or investment expertise, drawn from the complement of regular faculty, staff, and retirees and appointed on the recommendation of and via consensus agreement by the presidents of Faculty Association of the University of Waterloo (FAUW), the University of Waterloo Staff Association (UWSA), Canadian Union of Public Employees Local 793 (CUPE), and the University of Waterloo Retirees Association (UWRA)

c. Two (2) voting members to be drawn from the external community with expertise in pension risk and/or investment, recommended by the Pension & Benefits Committee from a master list of potential members with relevant expertise for the Pension Investment Committee, with said list updated annually, and 

Four non-voting members appointed by the Board of Governors on the recommendation of the Governance Committee:

d. Two (2) from university administration appointed on the recommendation of the university president, and 

e. Two (2) from the employee groups appointed on the recommendation of and via consensus among the presidents of CUPE, FAUW, UWSA, and UWRA. Normally these two representatives would not come from constituencies appointing voting members under 2(b)

At least three voting members shall have investment expertise and at least three voting members shall have experience in managing pension risk. The committee may engage experts from industry or academia if specific advice is required.

Appointments are for one (1) three-year term with the option to reappoint for one (1) additional three-- year term. Members may be reappointed for two (2) additional three-year terms thereafter following a two-year break from the end of their most recent term.

The chair of the Committee is appointed from among the external members (under either 2(a) or 2(c)) of the committee by the Board of Governors, on the recommendation of the Governance Committee.

3. Meetings

The committee will meet at least four times per year, approximately quarterly, from September to June. Additional meetings will be called as required. In person attendance at meetings is encouraged, however, members may attend meetings electronically when the university and members have appropriate alternate means at their disposal. Between meetings, at the agreement of the committee and at the direction of the chair, the secretary may facilitate voting on a motion or motions through email or another suitable platform, provided none of the members object on the grounds that further information or discussion is reasonably required in order to make a proper decision. Meetings are restricted to committee members and guests invited by the committee.

Quorum

Will be at least four voting members, with: at least two members appointed from the Board, one member from the employee/retiree constituency, and one member from the external community.

4. Terms of Reference

Investment of Pension Assets

a. To review, at least annually, the Statement of Investment Policy and Procedures along with the Fund Implementation Procedures (the “SIPP” and the “FIP”, respectively) including any input from the Finance & Investment Committee and to recommend any amendments to the SIPP and/or FIP through the Pension & Benefits Committee to the Board of Governors

b. To make recommendations to the Pension & Benefits Committee from time to time on the selection and termination of investment manager/mandates for the Plan. The committee may also, at its discretion, rely upon the due diligence conducted by the Finance & Investment Committee in carrying out its responsibilities under this article. Each voting constituency and at least one member of the Finance & Investment Committee will be included on any selection subcommittee to facilitate efficiency and effectiveness of manager mandate selection across all the University’s funds

c. To monitor the performance of all external fund managers and the market conditions for the plan’s investments funds, and to meet with the external fund managers from time to time

d. To regularly review the Plan’s assets for compliance with Board-approved Responsible Investment Policy, exercising oversight and responsibility on behalf of the Pension & Benefits Committee

e. To review at each meeting the investment returns of the Plan assets, the performance of the investment managers, the profile of the Plan assets with respect to acceptable risk tolerances, asset allocation, and the outlook for meeting the Plan’s liabilities

f. To approve asset mix changes and investment decisions in compliance with the SIPP and FIP amongst the approved managers/mandates where the cumulative annual transaction(s) represents less than 20% of the Plan's total assets at the beginning of the calendar year. This activity includes allocations to newly-approved managers, or existing-approved managers. The committee may at its discretion place investment managers on watch based on criteria developed by the committee

Reporting and Liaison

g. To review any reports provided by the Pension & Benefits Committee including the annual valuation, investment-related risk/return assessments, and asset-liability studies and to advise the Pension & Benefits Committee on those reports

h. To provide written reports to the Pension & Benefits Committee and to the Finance & Investment Committee at least quarterly, generally following each meeting, outlining the Pension Investment Committee’s activities, decisions, recommendations, future agenda items, and any other applicable information. The committee may seek the advice of either the Pension & Benefits Committee or the Finance & Investment Committee on any matter within the committee’s authority

i. To request a meeting with the Pension & Benefits Committee in the event of a significant market event or shift, to discuss issues such as: specifics of significant changes in the investment environment; desirable changes to asset mix; overall risk appetite; the quality of specific investments and/or performance of investment managers/mandates during the event or shift; and market opportunities that may be presented due to the event or shift, and report on such deliberations to the Finance & Investment Committee and the Board of Governors

j. To advise and/or make recommendations to the Board of Governors and/or the Pension & Benefits Committee on any matter within the committee’s authority

k. The chair is to meet, at least annually, with the chairs of the Finance & Investment Committee and the Pension Investment Committee to ensure efficiency and effectiveness of investment governance

l. To review, at least annually, the adequacy of the Committee's terms of reference as well as those of the Pension & Benefits Committee (in consultation with that committee’s chair), and to propose any needed amendments to the Governance Committee

Voting

Where a question is to be decided with a formal vote, the result of the vote must have the support of at least one member from each of the three voting constituencies to validly carry the motion. As is the case with all decision-making relating to the administration of the Plan and the investment of the Plan’s assets, a Committee member’s vote in respect of a question or resolution before the Committee shall be made in accordance with the best interests of all of the Plan’s members and pensioners.

Approved on October 30, 2018 
amended on April 4,  2023