Mercer Global Investment Forums 2019

2019

DUBLIN3-4 September 2019

Forum Agenda

Contains links to related content on Mercer.com

MONDAY 2 SEPTEMBER

15:00–16:00Fund Manager Briefing Registration

16:00–18:55Fund Manager Briefing

19:00–21:00Welcome Dinner Reception

TUESDAY 3 SEPTEMBER

07:30–09:00Registration

08:00–09:00Breakfast

09:00–09:15Welcome and Opening

Olivier SantamariaHead of Investments, Ireland

In this session, we present our investment themes for 2019 and beyond, taking you from the white waters of the late cycle through winds of change in market participation and tectonic frictions in the global world order to sustainability gathering momentum. We believe these themes will present both challenges and opportunities as well as drive change in the investment landscape. We discuss how different investors, both locally and globally, can respond to these themes and how they can seek practical investment opportunities to improve portfolio outcomes.

Deb ClarkeGlobal Head of Investment Research

Nick WhiteGlobal Strategic Research Director

Joanne HoldenUK Chief Investment Officer and European Director of Strategic Research

Caitriona MacGuinnessDC and Master Trust Market Leader

10:00–10:05MC

Rob MeaneySenior Investment Consultant

'The Sequel' to Mercer's 2015 Investing in a Time of Climate Change report was published in April. This report analyses the impact of climate-related physical damages and the transition to a low-carbon economy on long-term expected returns, and it provides examples of portfolio impacts between more- and less-climate-aware versions.

In this session, we discuss the influential drivers over both the short and the long term, we identify priority exposures and we discuss what steps can be taken to position portfolios for future resilience. The session focuses on implementation and includes an opportunity for active discussion.

Helga BirgdenGlobal Business Leader, Responsible Investment

Steven SowdenSenior Investment Consultant

10:35–10:55Game of Later Life – Concept and Round 1

A healthy and happy retirement is the goal of retirees worldwide. The financial services industry is a critical component in achieving this, helping to provide retirees with the income they need to support their lifestyles. As the number of retirement savings products and investment options for defined contribution investors expands, providing an income for life becomes increasingly complex. The Game of Later Life puts you in the position of a retiree and asks you to match retirement savings products and investment options with your retirement goals. The aim of the game is not to have the highest level of income nor to make the most money from your investments but rather to have the healthiest and happiest retirement.

Ciara WyerPortfolio Manager, Delegated Solutions, Ireland

10:55–11:30Networking and Coffee Break

11:30–12:30Keynote Address: Climate Solutions and the Role of the Investment Community

Every day, the news on climate change gets worse. On 11 May 2019, scientists at the Mauna Loa Observatory in Hawaii, which has tracked atmospheric CO2 levels since the late 1950s, detected 415.26 parts per million (ppm). The last time Earth's atmosphere contained this much CO2 was more than three million years ago, when global sea levels were several metres higher. Time is of the essence, and we need to mobilize.

The frameworks negotiated by member states of the UN in 2015 — the 2030 Agenda, with its 17 sustainable development goals, and the Paris Climate Agreement — were voluntary or weak in enforceability. However, the report of the IPCC last October on global warming at 1.5°C has altered our understanding of the situation we are in. The report made it clear that staying at or below 1.5°C warming above pre-industrial standards was the only safe level for the whole world and that further warming up to 2°C would cause considerable risk to the planet.

This was followed by the UN report in May 2019 on the loss of biodiversity and potential extinction of one million species.

As a consequence, we can no longer afford to regard the 2030 Agenda and the Paris Climate Agreement as voluntary and a matter for each member state to decide on its own. Instead, the full implementation of both has become imperative in order to secure a liveable world for our children and grandchildren. This requires a change of mind-set at the global political level. The IPCC has called for a 45% reduction in carbon emissions by 2030 and said that this is doable if there is the political will and the investment community certainly has a huge role to play.

Mary RobinsonFormer President of Ireland, Chair of The Elders and UN Special Envoy on Climate Change

In the white waters of the late cycle, it's important to be proactive about how you structure your portfolio in preparation for what's to come. You should look for opportunities that will help your portfolio continue to thrive in the face of potential slowing growth, rising interest rates and uncertain market conditions. In this short session, we identify a number of asset class opportunities that could make your portfolio more robust in the likely turbulence of this late cycle.

Matt ScottStrategic Research Specialist

12:40–12:50Game of Later Life – Round 2

A healthy and happy retirement is the goal of retirees worldwide. The financial services industry is a critical component in achieving this, helping to provide retirees with the income they need to support their lifestyles. As the number of retirement savings products and investment options for defined contribution investors expands, providing an income for life becomes increasingly complex. The Game of Later Life puts you in the position of a retiree and asks you to match retirement savings products and investment options with your retirement goals. The aim of the game is not to have the highest level of income nor to make the most money from your investments but rather to have the healthiest and happiest retirement.

Ciara WyerPortfolio Manager, Delegated Solutions, Ireland

12:50–14:05Lunch

14:05–14:40Surveying the Asset Management Landscape: Trends and Portfolio Impacts

The asset management industry is undergoing significant change as it looks to adapt to the evolving trends in the institutional investing landscape. We hear firsthand from a panel of trustees on the key shifts observed within the asset management industry and discuss the implications of increased regulations and complexity of investment products on asset portfolio structures and overall governance. Ultimately, we aim to get a trustee view on the key challenges facing the industry and discuss what can be done to ensure it remains fit for purpose and aligned to asset owners' requirements.
Facilitator

Rosalind BriggsSub-Market Business Leader

Panelists

Kevin CoughlanExecutive Director, JP Morgan

Patrick HealyChairman, AXA Ireland Trustees

Consolidation is fast building momentum in the UK and is arguably becoming a synonym for superfunds. This session challenges that notion and explores the many options for benefitting from economies of scale when managing both assets and liabilities. The speakers also discuss the implications for schemes and asset managers.

Andrew WardLeader, Risk Transfer and DB Journey Planning

Joanne HoldenUK Chief Investment Officer and European Director of Strategic Research

15:00–15:40Campfire Conversations: Fireside Chats with Mercer Clients – Round 1

Contractual Income Assets: Alternative Risk Reduction in a Low-yield Environment

The low level of yields on sovereign and corporate debt poses significant challenges for defined benefit pension schemes. De-risking out of equities may lead to portfolio returns that are inadequate to meet funding objectives, and for mature schemes requiring regular cash flows, the coupon income is too low.

These challenges can be addressed by investing in range of nontraditional asset classes that provide both predictable above-discount-rate returns and regular income, generally referred to as contractual income assets.

Our panel discusses their experience of these asset classes and how they can work for other Irish and UK pension schemes.
Facilitator

Vanessa HodgeSenior Investment Consultant

Clients

Patrick McKennaDirector, International Pension for Pfizer

Vikram ChatrathHead of Pensions, AXA UK plc

The Burgeoning Master Trust and DC Space: Trends, Insights and Actions

A master trust is a multi-employer pension scheme that allows sponsors to retain control over plan design while delegating trusteeship to professional trustees. Master trusts provide a solution that delivers cost, risk and time efficiencies while ensuring best-practice pension scheme arrangements. If trends in other markets follow through in Ireland, we could see master trusts representing a significant portion of the Irish pensions market. This session explores the trends in master trusts amid an uncertain regulatory backdrop and gives tangible examples of how master trusts have provided a cost-effective and engaging solution for both plan sponsors and members.
Facilitator

Anita ButlerSenior Investment Consultant

Clients

Robin ArmerNational Business Development Manager, NEST Corporation

Liz JewkesHead of UK and Ireland, Pensions and International Mobility, Sodexo

The Essentials to ESG-proof Your Portfolio

Across the investment industry, sustainability is gathering momentum. Regulatory drivers, consumer awareness and investor interest are all leading to rapid innovation in how the asset management industry captures sustainability and other aspects of responsible investment (RI) in investment decision-making. But what does it mean to embed RI (that is, ESG, stewardship, sustainability) within your portfolio? How do you capture the various elements of RI across different asset classes? Can you ever be 'done' with 'ESG-proofing' your portfolio? What challenges do investors face, and how can you evolve in such a rapidly changing environment? Join this session to hear from fellow asset owners on where they are on their RI journeys, and get some tips along the way.
Facilitator

Sarika GoelResponsible Investment Specialist, Equity Boutique

Clients

Janet MuirDirector of Finance, Global Crop Diversity Trust

Jim FoleyExecutive Director, Trustee Decisions Ltd

Stephen BarrieDeputy Director of Ethics and Engagement, Church of England Pensions Board

IORP II – Mastering the ABC of Regulation and Reporting

The second European Pensions Directive, known as IORP II, represents the biggest regulatory change for EU-based occupational pension plans in many years. It constitutes the next step in the EU's drive to shore up the European financial system following the reform of the banking and insurance sectors. IORP II is about improving member outcomes and protections by raising and harmonising governance and risk management standards. It also encourages a broadening of the scope of investment activity and sets out new reporting obligations. In this session, our panel looks at the immediate impacts and challenges and what this might mean for the pensions industry.
Facilitator

James CampbellSenior Legal Consultant

Clients

Richard ClossickSenior Investment Consultant

Joyce BrennanExecutive Director, Irish Pensions Trust Ltd

15:40–16:20Campfire Conversations: Fireside Chats with Mercer Clients – Round 2

Contractual Income Assets: Alternative Risk Reduction in a Low-yield Environment

The low level of yields on sovereign and corporate debt poses significant challenges for defined benefit pension schemes. De-risking out of equities may lead to portfolio returns that are inadequate to meet funding objectives, and for mature schemes requiring regular cash flows, the coupon income is too low.

These challenges can be addressed by investing in range of nontraditional asset classes that provide both predictable above-discount-rate returns and regular income, generally referred to as contractual income assets.

Our panel discusses their experience of these asset classes and how they can work for other Irish and UK pension schemes.
Facilitator

Vanessa HodgeSenior Investment Consultant

Clients

Patrick McKennaDirector, International Pension for Pfizer

Vikram ChatrathHead of Pensions, AXA UK plc

The Burgeoning Master Trust and DC Space: Trends, Insights and Actions

A master trust is a multi-employer pension scheme that allows sponsors to retain control over plan design while delegating trusteeship to professional trustees. Master trusts provide a solution that delivers cost, risk and time efficiencies while ensuring best-practice pension scheme arrangements. If trends in other markets follow through in Ireland, we could see master trusts representing a significant portion of the Irish pensions market. This session explores the trends in master trusts amid an uncertain regulatory backdrop and gives tangible examples of how master trusts have provided a cost-effective and engaging solution for both plan sponsors and members.
Facilitator

Anita ButlerSenior Investment Consultant

Clients

Robin ArmerNational Business Development Manager, NEST Corporation

Liz JewkesHead of UK and Ireland, Pensions and International Mobility, Sodexo

The Essentials to ESG-proof Your Portfolio

Across the investment industry, sustainability is gathering momentum. Regulatory drivers, consumer awareness and investor interest are all leading to rapid innovation in how the asset management industry captures sustainability and other aspects of responsible investment (RI) in investment decision-making. But what does it mean to embed RI (that is, ESG, stewardship, sustainability) within your portfolio? How do you capture the various elements of RI across different asset classes? Can you ever be 'done' with 'ESG-proofing' your portfolio? What challenges do investors face, and how can you evolve in such a rapidly changing environment? Join this session to hear from fellow asset owners on where they are on their RI journeys, and get some tips along the way.
Facilitator

Sarika GoelResponsible Investment Specialist, Equity Boutique

Clients

Janet MuirDirector of Finance, Global Crop Diversity Trust

Jim FoleyExecutive Director, Trustee Decisions Ltd

Stephen BarrieDeputy Director of Ethics and Engagement, Church of England Pensions Board

IORP II – Mastering the ABC of Regulation and Reporting

The second European Pensions Directive, known as IORP II, represents the biggest regulatory change for EU-based occupational pension plans in many years. It constitutes the next step in the EU's drive to shore up the European financial system following the reform of the banking and insurance sectors. IORP II is about improving member outcomes and protections by raising and harmonising governance and risk management standards. It also encourages a broadening of the scope of investment activity and sets out new reporting obligations. In this session, our panel looks at the immediate impacts and challenges and what this might mean for the pensions industry.
Facilitator

James CampbellSenior Legal Consultant

Clients

Richard ClossickSenior Investment Consultant

Joyce BrennanExecutive Director, Irish Pensions Trust Ltd

16:20–16:55Networking and Coffee Break

After years of calm waters, markets are showing signs of a late-cycle swell. With slowing global growth, geopolitical tensions and central banks shifting towards tighter monetary policy, you may wonder about out-of-the-box opportunities for returns and diversification benefits for investors. In this interactive, quick-fire session, we introduce seven investment ideas outside the realm of what might be considered a 'traditional' asset allocation. It's up to you as the audience to identify which combination of ideas might fill an 'opportunistic' portfolio allocation. Will you ride the waves of opportunity with the Magnificent Seven?
Host

Ian MurrayStrategic Research Specialist

Investment Opportunities

1.Sustainability-themed Equity

Hill GastonResponsible Investment Consultant

Maria SfikaAsset Class Specialist, Fixed Income Boutique

3.Green Bonds

Michael TalbotAsset Class Specialist, Fixed Income Boutique

4.Secured Finance

Georgia WynterAsset Class Specialist, Fixed Income, Delegated Solutions

5.Insurance-linked Securities

Grace MortimerInvestment Consultant

6.Commodities

Rory SloggettInvestment Consultant

7.Trend-following Strategies

Shailan MistryAsset Class Specialist, Hedge Fund Boutique

17:25–17:35Game of Later Life – Round 3

A healthy and happy retirement is the goal of retirees worldwide. The financial services industry is a critical component in achieving this, helping to provide retirees with the income they need to support their lifestyles. As the number of retirement savings products and investment options for defined contribution investors expands, providing an income for life becomes increasingly complex. The Game of Later Life puts you in the position of a retiree and asks you to match retirement savings products and investment options with your retirement goals. The aim of the game is not to have the highest level of income nor to make the most money from your investments but rather to have the healthiest and happiest retirement.

Ciara WyerPortfolio Manager, Delegated Solutions, Ireland

17:35–17:45Final Remarks

Rob MeaneySenior Investment Consultant

19:30–22:30Drinks and Offsite Dinner

WEDNESDAY 4 SEPTEMBER

08:00–09:00Breakfast

09:00–09:05Opening Remarks

Tom GeraghtyChief Executive Officer, Europe

09:05–09:10MC

Fran BrowneSenior Investment Consultant

09:10–09:40Featured Speaker: Balancing Competition and Collaboration to Achieve More

Today, during the Fourth Industrial Revolution, we face evermore complex challenges. Some of them, we choose, and some choose us. What we decide to do about them is what counts. Drawing from his experiences as an adventure athlete racing to the South Pole and his new expedition exploring the intersection where humans and technology collide, Mark Pollock shares his insights into decision-making in a competitive environment and how to collaborate to achieve more.

Mark PollockExplorer, Innovator and Collaboration Catalyst

Private market investing continues to be a growing area of importance for institutional investors seeking enhanced returns, better diversification, higher yield or increased exposure to inflation-sensitive assets. In this panel session, we discuss current trends and the opportunities and challenges of investing across the infrastructure, private debt and private equity markets.
Facilitator

Garvan McCarthyAlternatives Leader, Europe

Panelists

Adrian HodelPrivate Equity and Debt Specialist

Ashley KnightPrivate Equity and Debt Specialist

Catherine LloydSenior Infrastructure Specialist

10:10–10:40Networking and Coffee Break

East collides with West in the ultimate superpower showdown. China was once known as the Middle Kingdom and was regarded as the centre of the world. It is now set to overtake the US as the world's largest economy. At the same time, Chinese capital markets are opening to foreign investment. How will the US fight back? See how the superpowers stack up against each other when they go head-to-head. In a world increasingly driven by trade wars and technology, where will you invest?

Rupert WatsonHead of Asset Allocation, Delegated Solutions

Emerging markets continue to intrigue, fascinate and sometimes frustrate institutional investors. But given where we are in the cycle, how should we be building exposure? Three of our asset-class specialists make separate but compelling arguments for EM equities, EM debt and EM infrastructure. You choose who gets your emerging market vote in this late cycle.
Host

Damien DavisSenior Investment Consultant

Sessions

Indira SabitovaAsset Class Specialist, Equity Boutique

Joe AbramsAsset Class Specialist, Fixed Income Boutique

3.EM Macro

Penny AitkenAsset Class Specialist, Hedge Fund Boutique

11:50–12:00Game of Later Life – Final Destination

A healthy and happy retirement is the goal of retirees worldwide. The financial services industry is a critical component in achieving this, helping to provide retirees with the income they need to support their lifestyles. As the number of retirement savings products and investment options for defined contribution investors expands, providing an income for life becomes increasingly complex. The Game of Later Life puts you in the position of a retiree and asks you to match retirement savings products and investment options with your retirement goals. The aim of the game is not to have the highest level of income nor to make the most money from your investments but rather to have the healthiest and happiest retirement.

Ciara WyerPortfolio Manager, Delegated Solutions, Ireland

12:00–12:15Bringing It All Together – Practical Application

In this session, we bring together the various themes and topics highlighted over the course of the Forum. We put forward suggestions for how you as investors can build these ideas into your future investment plans to ultimately help brave the elements and surf the late cycle.

Niall O'SullivanEuropean Chief Investment Officer, Delegated Solutions, Ireland

12:15–13:30Lunch

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