Ontario Teachers’ New CIO Sets Leadership Team

The Ontario Teachers’ Pension Plan (OTPP) has appointed four senior vice presidents under new CIO Bjarne Graven Larsen.

The appointments include a newly created role for Ziad Hindo: SVP for capital markets. The role gives Hindo oversight for the pension’s centralized trade execution and treasury function.

Hindo joined OTPP in 2000 and was previously SVP for tactical asset allocation and natural resources.

Responsibility for natural resources has transferred to Andrew Claerhout, who becomes SVP for infrastructure and natural resources. He has been with OTPP for 11 years and has “held positions of increasing responsibility” in the pension’s London and Toronto offices, OTPP said in a statement.

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Michael Wissell has taken on another newly created position: SVP for portfolio construction. OTPP said the role would give Wissell responsibility for “the fund-wide economic outlook, detailed asset mix, and risk budget allocation with the asset classes.”

Wayne Kozun, previously SVP in charge of fixed income and alternatives, has been appointed SVP for public equities. He has been at OTPP since 1995.

Larsen took up his position as OTPP’s CIO on February 1. He succeeds Neil Petroff, who stepped down last year.

Defined contribution (DC) plans now represent nearly half of the world’s retirement assets, according to Willis Towers Watson.

The firm’s 2016 Global Pension Assets Study found that DC savings increased in share from 39.9% in 2005 to 48.4% in 2015—growing at more than double the rate of defined benefit (DB) assets.

“While the shift to DC, led by the US market, has been the trend for some years now, DC has recently become the dominant global model,” said Steve Carlson, head of the Willis Towers Watson’s Americas investment business.

The US remained one of the leaders in the sector, with DC funds representing 59.7% of American retirement assets in 2015. Australia, however, had the highest proportional allocation to DC, at 86.6%.

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Japan, Canada, and the Netherlands, meanwhile, have yet to seriously convert, with DC assets of 3.8%, 4.5%, and 5%, respectively.

This reluctance to adopt DC could be because the funds are still “handicapped” by limited governance, risk-sharing models, and investor understanding, according to Roger Urwin, global head of investment content at Willis Towers Watson.

“We remain concerned that pension provisions will fall well short of member expectations based on a central investment outlook for decidedly skinny returns which is compounded by relatively low contribution rates,” Urwin said. “On top of capital market risks there remain large risks of regulation and governance mismanagement.”

Overall, retirement assets in the 19 countries included in the report totaled $35.4 trillion in 2015—a decline of 0.5% from $35.6 trillion at the end of 2014. The US was by far the largest pension market at $21.7 trillion, or 61.5% of global pension assets.

Retirement assets on average have grown at a 5-year rate of 9.1% and 10-year rate of 7.1%. The fastest growing country was Chile, with 5- and 10-year growth rates of 23.8% and 17.9%, respectively.

db dc Source: Willis Towers Watson’s “Global Pension Assets Study 2016“