Mercer Global Investment Forums 2019

2019

TORONTO20-21 June 2019

Forum Agenda

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WEDNESDAY 19 JUNE

15:45–16:30Asset Manager Registration

16:30–18:55Asset Manager Briefing

19:00–21:00Welcome Reception & Buffet Dinner

THURSDAY 20 JUNE

07:30–08:45Registration

07:45–08:45Breakfast

08:45–09:00Welcome and Opening

Jean-Philippe ProvostWealth Leader, Canada

09:00–09:452019 Investment Themes, Reference Portfolios and Practical Application

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.

Nick WhiteGlobal Strategic Research Director

Yusuke KhanDirector of Strategic Research, Canada

Todd NelsonWealth Business Leader, Toronto

09:45–09:50MC

Teresa PalandraOffice Leader, Toronto

09:50–10:20Building Robust Equity Portfolios

In this session, we discuss our thinking on how to design a robust equity portfolio. Our discussion centres on four key pillars, including a desire to invest broadly, invest sustainably, use active management selectively and invest in a balanced range of risk and return drivers. This session builds on our prior work regarding tilting portfolios toward return drivers that have been shown to be return-enhancing and diversifying.

Michael McMurraySenior Investment Consultant

Sean ChatburnAsset Class Specialist, Equity Boutique

10:20–10:35Game of Later Life – Concept & 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.

Brett JenningsSenior Investment Consultant

10:35–11:05Networking and Coffee Break

11:05–12:05Keynote Address: Wealth in the Era of Artificial Intelligence

Recent advancements in artificial intelligence (AI) have been described as more profound than electricity and fire. Despite this transformative potential, the primary application of AI in the world today is to sell advertisements online. How will global societies adjust to realize the field's exciting new uses? How will emerging applications of this powerful branch of computer science alter measures of progress and wealth in business and society moving forward? This keynote session addresses these challenging questions and offers ideas of broader applications of AI.

Jonnie PennGoogle Fellow and Expert in Artificial Intelligence

12:05–12:35Tectonic Friction: Is the US or China the Best Place to Invest Going Forward?

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?

David ZanuttoSenior Investment Consultant

Jay LoveDirector of Strategic Research, USA

12:35–12:45Making the Most of Currency

Short-term currency movements can be significant, and strategic currency-hedging decisions can have substantial impacts on portfolio performance. Although unhedged currency exposures may have provided the portfolios of Canadian investors with a much-needed ray of sunshine in 2018, they can — and have — cast grey skies over otherwise sunny conditions. Are Canadian investors making the most of their currency-hedging policies? In this session, we explore the details of foreign currency exposures for Canadian portfolios and challenge whether common strategic hedging policies are the best approach for keeping the rain away.

Jonathan CroftSenior Investment Consultant

12:45–12:55Game 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.

Brett JenningsSenior Investment Consultant

12:55–14:10Lunch

14:10–14:45Retirement Plans in a DC Environment

As the world gradually moves from DB to DC pension environments, the development of good benefit designs for the retirement years remains a challenge. No one has solved it, and it now represents a new challenge for many Canadian retirement plans.

Yet the challenges are not just for the retirement plans. In a DC environment, the risks are transferred to the retirees, many of whom have very limited understanding of these risks. There is however the potential for greater flexibility and variation in the benefits offered, which may provide a better outcome for many retirees.

In this session, we explore what employees really want and need in their retirement, the risks they face in the decumulation phase and what measures can be taken to address some of these risks and challenges.
Facilitator

Jillian KennedyLeader of DC and Financial Wellness, Canada

Panel

David KnoxSenior Actuary and National Leader, Research and Policy, Australia

Cara BourdeauSenior Human Resources Consultant, Total Rewards, Western University

14:45–15:20Campfire Conversations: Fireside Chats with Mercer Clients – Round 1

What Really Drives the Alpha Hunter

We employ active management in specific areas of our investment portfolios because we believe we can earn more (after incremental fees) than with strategic allocations alone. The truth is, selecting managers that can deliver on this promise isn't always easy. Come listen to a group of diverse investors as they discuss their views on active management in today's environment, how they structure their portfolios to best capture alpha opportunities and what they look for as they hunt for the best investment managers.
Facilitator

Samantha CleynSenior Investment Consultant

Clients

Naveed MohammedHead of Managed Asset Strategy and Analytics, BMO Nesbitt Burns

Dustin AntonelliDirector, Investments Public Markets, Saskatchewan Health Employee's Pension Plan (SHEPP)

Pierre CollinsDirector, Investments, Fondation Lucie et André Chagnon

Balancing Risk and Reward: What's Driving Our Asset Allocation Decisions

"Lower for longer," "low expected future returns," "increasing volatility" — these terms are frequently used to frame the current environment for investors. With the increasing allocation to alternatives and use of leverage, how concerned should you be about liquidity risk? There is also increasing pressure to take ESG factors into account. The balance between risk and reward seems more challenging than ever. How does all this translate to asset allocation decisions? This session is an occasion to hear sophisticated plan sponsors talk about their approaches to the current challenging environment.
Facilitator

Gilles LavoieSenior Investment Consultant

Clients

Doug MoodieChief Executive Officer, Nova Scotia Pension Services Corporation

Natasha TrainorDirector, Investments, University of Ottawa

What Drives Our Implementation Decisions

Over the past decade or more, the winds of change have swept across the pension landscape globally. Based on Mercer's database, 2/3 of Canadian private sector DB plans are now closed/frozen, and in the US, less than 20% of Fortune 500 co's offer a DB plan to new hires.

As a consequence, DC plan assets have grown rapidly, and are now demanding a bigger share of plan sponsors' investment governance wallet … and plan sponsors have had to pivot by streamlining the oversight of their closed DB plans in order to free up time and resources to meet the growing oversight demands of their DC plans.

On the DB plan front, some sponsors have others have opted to maintain control of both tactical and strategic decisions while others have opted to sharpen their focus on funding and risk strategy, and to outsource tactical decisions to a third party. And other asset pool overseers like insurance companies, endowments and foundations have in some cases also changed THEIR implementation models, albeit with different drivers for doing so.

On the DC side, entirely different considerations have led to the more recent emergence of outsourced DC governance models.

In this panel discussion, the questions posed will spin on this axis.

How are pension and endowment asset owners navigating decisions around what investment implementation models will work best for them? What drives those decisions? And what do plan sponsors want to see happen next?
Facilitator

Oma SharmaClient Relationship Manager

Clients

Sasha ZitoSenior Director, International HR - TransUnion

Robert PatzeltDeputy Chair and Chair of Investment Committee, Workers' Compensation Board of Nova Scotia

Martin BelangerDirector, Investments, Western University

Improving the DC Member Experience

As DC and savings plans continue to grow within the Canadian market, organizations are challenged with the task of engaging employees in saving and planning for retirement. As a valuable part of the total employee value proposition, a retirement program is not always engaging or understood well by employees. This session explores how to better engage your employees in their DC plan. With a focus on financial wellness tactics, learn how an organization learns to incorporate the concept of financial wellness as a guiding principle for employees — replacing the need to engage only in retirement. This session will help you start your own process in defining an approach to engage your employees in their DC plans.
Facilitator

Jillian KennedyLeader of DC Financial Wellness, Canada

Clients

Jason TraettoSenior Manager, Benefits and Wealth Programs, Rogers Communications

15:20–15:55Campfire Conversations: Fireside Chats with Mercer Clients – Round 2

What Really Drives the Alpha Hunter

We employ active management in specific areas of our investment portfolios because we believe we can earn more (after incremental fees) than with strategic allocations alone. The truth is, selecting managers that can deliver on this promise isn't always easy. Come listen to a group of diverse investors as they discuss their views on active management in today's environment, how they structure their portfolios to best capture alpha opportunities and what they look for as they hunt for the best investment managers.
Facilitator

Samantha CleynSenior Investment Consultant

Clients

Naveed MohammedHead of Managed Asset Strategy and Analytics, BMO Nesbitt Burns

Dustin AntonelliDirector, Investments Public Markets, Saskatchewan Health Employee's Pension Plan (SHEPP)

Pierre CollinsDirector, Investments, Fondation Lucie et André Chagnon

Balancing Risk and Reward: What's Driving Our Asset Allocation Decisions

"Lower for longer," "low expected future returns," "increasing volatility" — these terms are frequently used to frame the current environment for investors. With the increasing allocation to alternatives and use of leverage, how concerned should you be about liquidity risk? There is also increasing pressure to take ESG factors into account. The balance between risk and reward seems more challenging than ever. How does all this translate to asset allocation decisions? This session is an occasion to hear sophisticated plan sponsors talk about their approaches to the current challenging environment.
Facilitator

Gilles LavoieSenior Investment Consultant

Client

Doug MoodieChief Executive Officer, Nova Scotia Pension Services Corporation

Natasha TrainorDirector, Investments, University of Ottawa

What Drives Our Implementation Decisions

Over the past decade or more, the winds of change have swept across the pension landscape globally. Based on Mercer's database, 2/3 of Canadian private sector DB plans are now closed/frozen, and in the US, less than 20% of Fortune 500 co's offer a DB plan to new hires.

As a consequence, DC plan assets have grown rapidly, and are now demanding a bigger share of plan sponsors' investment governance wallet … and plan sponsors have had to pivot by streamlining the oversight of their closed DB plans in order to free up time and resources to meet the growing oversight demands of their DC plans.

On the DB plan front, some sponsors have others have opted to maintain control of both tactical and strategic decisions while others have opted to sharpen their focus on funding and risk strategy, and to outsource tactical decisions to a third party. And other asset pool overseers like insurance companies, endowments and foundations have in some cases also changed THEIR implementation models, albeit with different drivers for doing so.

On the DC side, entirely different considerations have led to the more recent emergence of outsourced DC governance models.

In this panel discussion, the questions posed will spin on this axis.

How are pension and endowment asset owners navigating decisions around what investment implementation models will work best for them? What drives those decisions? And what do plan sponsors want to see happen next?
Facilitator

Oma SharmaClient Relationship Manager

Clients

Sasha ZitoSenior Director, International HR - TransUnion

Robert PatzeltDeputy Chair and Chair of Investment Committee, Workers' Compensation Board of Nova Scotia

Martin BelangerDirector, Investments, Western University

Improving the DC Member Experience

As DC and savings plans continue to grow within the Canadian market, organizations are challenged with the task of engaging employees in saving and planning for retirement. As a valuable part of the total employee value proposition, a retirement program is not always engaging or understood well by employees. This session explores how to better engage your employees in their DC plan. With a focus on financial wellness tactics, learn how an organization learns to incorporate the concept of financial wellness as a guiding principle for employees — replacing the need to engage only in retirement. This session will help you start your own process in defining an approach to engage your employees in their DC plans.
Facilitator

Jillian KennedyLeader of DC Financial Wellness, Canada

Clients

Jason TraettoSenior Manager, Benefits and Wealth Programs, Rogers Communications

15:55–16:25Networking and Coffee Break

16:25–16:45Mastering the Elements: How to Structure an Income-Producing Portfolio

There are many reasons to need or want a portfolio that produces an income, from an institution looking to meet its liabilities to an individual trying to match his or her spending needs. Given the contrasting objectives of these individuals and institutions, you cannot take a one-size-fits-all approach. This session focuses on how to enhance income in a portfolio to suit different goals and objectives.

Jeff BunceAsset Class Specialist, Fixed Income

Ryan AndersonSenior Investment Consultant

16:45–17:10So You Want to Tilt your Equity Portfolio

Publicly traded equities continue to form the foundation of Mercer's growth portfolios. Although these portfolios represent our best-practice long-term views, modest (and sometimes significant) tilts may be justified from time to time. This session features seven of Mercer's rising professionals arguing for seven distinct tilts to a broad equity portfolio. You get to vote on how you will tilt your equity portfolio to each of these.
Facilitator

Aisling DohertySenior Investment Consultant

Sessions

Oh Canada

Patrick GrahamAsset Class Specialist, Equity Boutique

It's Time for China A-Shares

Kimberly HartInvestment Consultant

USA All the Way

Elena DemopoulosInvestment Consultant

Frontier Markets Lead the Way

Victoria GohAsset Class Specialist, Equity Boutique

Small Cap Is Where It's At

Matthew MerriamInvestment Analyst

Low Vol Forever

Misbah LalaniInvestment Analyst

Sustainability-Themed Equity Is the Future

Stacy WaltersAsset Class Specialist, Equity Boutique

17:10–17:20Game 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.

Brett JenningsSenior Investment Consultant

17:20–17:40Keeping the End Goal in Mind

There are a multitude of investment options and solutions available to busy fiduciaries — but only a very small portion of them get implemented. During this session, we explore the key elements of an effective governance framework and the emerging trends for large, midsize and small asset owners. We discuss the common themes and variations of the end goals fiduciaries are working towards and the implementation options available to them as they strive to increase returns, reduce risk, reduce costs and make better use of time.

Dave MakarchukWealth Leader, Western Canada

17:40–17:45Final Remarks

Teresa PalandraOffice Leader, Toronto

18:00–22:00Drinks & Offsite Dinner

FRIDAY 21 JUNE

08:00–09:00Breakfast

09:00–09:05MC

Angelita GrahamSenior DB Actuarial Consultant

09:05–09:45The Importance of Diversity and HR Transformation

It is well known that diversity is a key business imperative for organizations today. In this session, we discuss the evolving diversity and inclusion landscape and provide insights on ways to infuse D&I throughout the employee lifecycle as a key component for building the workforce of the future. We provide perspectives on opportunities within the industry and examples of transformational programs, and we facilitate dialogue to build awareness and enable sharing of leading practices.
Host

Kevin HendershotSenior Client Management and Development Consultant

Panel

Jaqui ParchmentCEO, Canada

Ilana HechterSenior HR Effectiveness Consultant

09:45–10:15Investing in a Time of Climate Change – Ramifications for Portfolios

"The Sequel" to Mercer's 2015 Investing in a Time of Climate Change report was published in April. This new report analyzes 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.

Max MesservyResponsible Investment Consultant

Karen LockridgeSenior Investment Consultant

10:15–11:35Profiling the DC Portfolio: Investing in 2020 and Beyond

The growth in the number and types of investment options coupled with the changing demographics will require investment options that are simpler for DC plan members to understand but may be more challenging for plan sponsors to evaluate. The challenge for plan sponsors is to reconcile the need to offer best-in-class investment vehicles while maintaining a simple but well-thought-out investment line-up. This session focuses on how investing in DC is evolving and how plan sponsors can meet the new challenges of DC investing in 2020 and beyond.

Pat LeoSenior Investment Consultant

Joseph BevilacquaSenior Investment Consultant

10:35–11:05Networking and Coffee Break

11:05–11:25To Annuitize … or Not to Annuitize … That Is the Question

Although the pace of group annuity transactions for DB plans continues to increase, these transactions still represent a small fraction of pension payments that could be annuitized. During this session, we discuss recent trends, our expectations going forward, we provide portfolio construction recommendations and set out some innovative ideas for those who aren't quite ready to annuitize.

Andrew WhaleSenior DB Actuarial Consultant

Hrvoje LakotaMDDS Strategy Consultant

11:25–11:35Late Cycle Opportunities for Robust Portfolios

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.

Venelina ArduiniInvestment Consultant

11:35–12:15Braving EM: Which is the Best Approach in This Late Cycle?

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 set out their cases for EM infrastructure, EM debt and EM equities. You will choose who gets your emerging market vote in this late cycle.
Moderator

Irfan HassanInvestment Consultant

Sessions

1.EM Infrastructure

Michael McGowanAsset Class Specialist, Alternatives

2.EM Debt

Chris KamykowskiAsset Class Specialist, Fixed Income

3.EM Equities

Robert VozzellaInvestment Consultant

12:15–12:25Game 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.

Brett JenningsSenior Investment Consultant

12:25–12:40Bringing 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.

Dave MakarchukWealth Leader, Western Canada

12:40–12:45Closing Remarks

Rich NuzumPresident, Wealth

12:45–14:00Lunch

Draft Agenda. Subject to change.
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