PBGC to Allow Greater Flexibility for Variable-Rate Premium Filings

Agency said move was needed because CARES Act didn’t provide special rules for PBGC premiums.


The Pension Benefit Guaranty Corporation (PBGC) said it will provide new flexibility for variable-rate premium filers to help mitigate the effects of the COVID-19 pandemic.

The PBGC said the move was necessary because the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which allows minimum contributions required by the Employee Retirement Income Security Act (ERISA) that were due during 2020 to be paid on Jan. 1, 2021, did not provide any special rules related to PBGC premiums.

As a result of the action, a premium refund will be available to account for employer contributions received by the plan during the extended period provided by the CARES Act.

“As COVID-19 continues to affect workers, families, and job creators across the country, PBGC continues to look for opportunities to provide the relief they need,” PBGC Director Gordon Hartogensis said in a statement. “This relief will support theadministration’s efforts to continue driving economic recovery and helping those in need.”

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Under the new guidance, premium filings due on or after March 1, 2020, and before Jan. 1, 2021, the date by which “prior year” contributions must be received by the plan to be included in plan assets, will be extended to Jan. 1, 2021. That means the discounted value of the contributions received by the plan after the premium is filed will be included in the asset value used to determine the variable-rate premium. As a result, plans will be able to amend the premium filing to revise the originally reported asset value when all prior year contributions have been made, and receive the corresponding refund of variable-rate premiums.

As an example, the PBGC used a calendar year plan to demonstrate the various due dates as they relate to PBGC premium filings:

  • The premium for the 2020 plan year is due Oct. 15, 2020.

  • The due date for 2019 plan year contributions was extended to Jan. 1, 2021, from Sept. 15, 2020.

  • Absent the relief provided, and assuming the premium is filed on Oct. 15, the discounted value of contributions for the 2019 plan year received by the plan:

    • On or before Oct. 15, 2020, are included in the asset value used to determine the 2020 variable-rate premium and

    • After Oct. 15, 2020, are not included in the asset value used to determine the 2020 variable-rate premium.

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Aiming to Boost Diversity, Canadian Institutions to Monitor Corporate Behavior

A group of funds holding roughly $2.3 trillion say they will make demands on companies whose stocks are in their portfolios.


A group of Canadian institutional investors with roughly $2.3 trillion in assets have joined a push in the wider industry to integrate diversity and inclusion in their investing practices.

Thirty-one signatories pledged they would monitor the diversity and inclusion practices of Canadian public companies in their portfolios, such as by pushing for improved disclosures, investment industry group Responsible Investment Association said last week. 

The asset owners and managers also said they also expect a revamping of company policies, targets, and timelines that improve diversity among board leadership and senior management.

“We all have a responsibility to ensure that the persistent inequities in business and our society are eliminated,” read the statement. 

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“As institutional investors, we can contribute to addressing these inequities in Canada by taking intentional steps to promote diversity and inclusion across our portfolios and within our organizations.”

Signatories include Alberta Investment Management Corporation (AIMCo), Caisse de dépôt et placement du Québec (CDPQ), and British Columbia Investment Management Corporation (BCI). 

Since June, when the death of George Floyd and other events sparked nationwide protests in the U.S., other institutional investors have deepened commitments to address racial economic disparities. In September, the Connecticut treasurer and the Ford Foundation launched a coalition of 14 firms with roughly $460 billion in market capitalization pledged to make greater strides toward racial equity.

Analysts at S&P Global also consider the growing corporate response to the racial unrest will increasingly impact environmental, social, and governance (ESG) scores for businesses.

Other Canadian investors making the pledge include: 

Addenda Capital
AGF Investments
Bâtirente
BMO Global Asset Management
Canada Post Corporation Pension Plan
Central 1 Credit Union
CIBC Asset Management
Connor, Clark & Lunn Investment Management
Deetken Impact
Desjardins Group
ELFEC
Gestion FÉRIQUE
Global Alpha Capital Management
IG Wealth Management
Jarislowsky Fraser Global Investment Management
Mackenzie Investments
MD Financial Management Inc.
Montrusco Bolton Investments Inc.
NEI Investments
OPSEU Pension Trust (OPTrust)
PCJ Investment Counsel
Rally Assets Inc.
RBC Global Asset Management Inc.
Scheer, Rowlett & Associates Investment Management
SEI Investments
Simon Fraser University
The United Church of Canada
University of Toronto Asset Management (UTAM)

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