Research Pension Plan
Update to Plan Participants
July 31, 2014
International Equity Fund – Investment Manager Change
Presently the funds in the International Equity Fund of the Academic Money Purchase Pension Plan are managed
by Sky Investment Counsel (Sky) though a subsidiary arrangement with Phillips, Hager and North Investment
Management Company. Effective August 13, 2014, the funds will be managed by Mawer Investment
Management Company (Mawer). This newsletter sets out the reasons for these actions.
In the past year the Research Pension committee, along with the Academic Money Purchase Pension Committee
(AMPPC) have become increasingly concerned with the underperformance of Sky. Over the past five years, the
average annual return on its managed funds net of fees has been less than the performance benchmark and the
volatility of returns has been higher than average. In light of this poor performance the AMPPC decided to conduct
an investment manager search for a possible replacement for Sky.
AONHewitt was engaged to create a list of potential replacements and the AMPPC interviewed principals of three
firms in June. On the basis of these interviews and reports prepared by the investment consultant, the AMPPC
recommended to the Board that Mawer replace the existing manager. The Board accepted this recommendation on
July 29, 2014.
Over the past ten years, the performance of Mawer in managing an international equity mandate has consistently
exceeded the performance benchmark net of fees by a significant margin while simultaneously producing below
average volatility of returns. For example, over four, seven and ten year periods, the annual excess return over the
benchmark has been 3.1%, 4.4% and 4.3%, respectively. This outperformance has occurred in both expansionary
and contractionary phases of the market cycle. The committee is of the view that the management structures and
investment processes of Mawer are stable enough to continue to generate these desirable outcomes into the future.
Since the International Equity Fund is a component of all three life-cycle funds, Conservative, Balanced and
Aggressive, it follows that to the extent that you have allocated your pension funds to any of the life-cycle funds or
directly to the International Equity Fund, your pension funds will be managed in part by Mawer by August 13,
2014 automatically without any action required on your part.
If you have any questions about the replacement of managers, please contact the Director of Pensions, Heather
Fortosky at 966-6276 or contact any of the Research Pension Plan committee members listed below.
S. Laycock (Human Resources)
O. Schemenauer (Financial Services)
K. DeMong (CLS)
L. Vanin (VIDO)
G. Camm (Plant Sciences)
This communication, future communications and other pension plan information are available online at:
www.usask.ca/fsd/faculty_staff/pension_plans
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