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Public Service Pension Plan Corporation Board of Directors

Department

Finance

Authority

Public Service Pensions Act, 1991 Joint Sponsorship Agreement Between: Her Majesty in Right of Newfoundland and Labrador, as represented by the Minister of the Department of Finance (the "Government") And: The Association of Allied Health Professionals ("AAHP") The Canadian Union of Public Employees ("CUPE") The International Brotherhood of Electrical Workers ("IBEW") The Newfoundland and Labrador Association of Public and Private Employees ("NAPE") The Newfoundland and Labrador Nurses' Union ("NLUN") (collectively the "Unions')

Remuneration

The annual remuneration for the Public Service Pension Plan Board of Directors is as follows: • Chair $5,000 • Vice-Chair $2,500 • Director $1,250 • Chair of Sub-Committee $1,250 (in addition to Director's annual remuneration) Remuneration of Directors per meeting • ½ day - $250 • Full day - $500 All directors receive the annual honorarium, but government and union employees do not receive meeting fees. Travel incurred related to the business of the Board of Directors will be reimbursed in accordance with the established travel policy.

Purpose:

On December 10, 2014, the Government of Newfoundland and Labrador signed a Joint Sponsorship Agreement (JSA) with the five largest unions representing the employees of the Public Service Pension Plan. This agreement provides for joint management of the pension plan and equal sharing of future surpluses and deficits in the pension fund between government and plan members. A pivotal element of the JSA is the establishment of an independent corporation known as the Public Service Pension Plan Corporation (PSPP Corporation) as a statutory corporation without share capital and which is not a Crown agent. The PSPP Corporation was established to administer the plan and manage the investment of the Public Service Pension Fund.

The Corporation is managed by a Board of Directors, the roles and responsibilities of which are defined in sections 36.3 through 36.4 of the Public Service Pensions Plan Act, 1991 and Appendix B of the Joint Sponsorship Agreement. The Board of Directors is accountable for the exercise and discharge of the objects of the corporation which are as follows:

  • To act as trustee of the Public Service Pension Plan Fund
  • To act as administrator of the pension plan, and to exercise those other powers and perform those other duties as may be expressly conferred upon the corporation under the joint sponsorship agreement 

For additional information on the role of the PSPP Corporation, please refer to:

Structure:

Pursuant to the JSA, the Board of Directors is comprised of 14 persons who are to be appointed as follows:

  • Six Government Appointees
  • Six Union Appointees
  • 1 Non-union Appointee
  • 1 Inactive Member Appointee

There is a Chair and Vice-Chair of the Board of Directors. The initial Chair was appointed by Government from among the Directors. The initial Vice-Chair was appointed by the Unions from among the Directors. The Chair and Vice-Chair serve for a two year term. At the end of each term on a rotating basis, the Government Appointees will appoint a Chair or Vice-Chair of the Corporation from their Board members; and the Union Appointees will appoint a Chair or Vice-Chair from their members.

Competency Profile:

Each of the Government Appointees, as a collective, and the Union Appointees, as a collective, must possess competencies, by reason of experience, commitment or knowledge, in the following areas:

  • Pension plan governance, including understanding the roles of the Sponsors, the fiduciary board and the service providers in the overall governance of the PSPP
  • Pension administration
  • Delegation to and monitoring of agents, employees and advisors
  • Asset/liability management and pension policy
  • Macro-economic considerations and their impact on investment strategies and pension obligations
  • Capital markets and private investments such as infrastructure, private equity and real estate
  • Investment risk management
  • Pension plan design issues and pension policy issues
  • Actuarial terminology and actuarial balance sheets
  • Key issues in contractual relationships with sophisticated counterparts
  • The application of and compliance with pension laws, cases and regulatory rules, including the requirements of any provincial legislation and the Income Tax Act (Canada)

The Board of Directors must also ensure that all new Directors receive a comprehensive orientation, ensuring that they fully understand:

  • The role of the Board and its committees, if any
  • The contribution expected from individual Directors
  • The objects of the Corporation

Continuing education opportunities will also be provided to all Directors so that they can maintain or enhance their skills and abilities and ensure that their knowledge and understanding of the objects of the Corporation remain current.

Qualifications:

The following qualifications have been identified (as per the JSA):

  • A representative on the Sponsor Body must not be a Board Director
  • An officer of the Corporation must not be a Board Director
  • Qualification as a Board Director is subject to Section 172 of the Corporations Act, RSNL 1990, c-36

A Board Director, in exercising his or her powers and discharging his or her duties, must also:

  • act honestly and in good faith with a view to the best interests of the pension plan and for the benefit of all employees, pensioners and deferred pensioners
  • exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances

Additionally, according to the JSA, the Board of Directors should also possess the following personal characteristics:

  • Integrity, including familiarity with and a high regard for fiduciary obligations
  • Strong commitment to time and effort required to undertake the role
  • Demonstrated ability to contribute and operate with candor and intelligence while supporting other directors to do the same
  • Effective negotiation skills in articulating viewpoints with influence to arrive at a conclusion in the best interests of the Pension Plan and for the benefit of all Members
  • Strong conflict management skills to enable the identification and handling of conflicts in a sensible, fir and efficient manner
  • Willingness to accept and support Board decisions
  • Acting with a mindset of impartiality as it relates to Sponsors
  • Freedom from influence by any factors other than the interest of the Pension Plan and all Members
  • Team effectiveness, including the ability to work effectively in a collegial environment and to facilitate consensus and compromise
  • After the Government has ceased to provide plan administration and plan investment services to the Teachers’ Pension Plan, absence of systemic conflicts of interest it being understood that membership in or employment by the NLTA or the Government or entitlement to or receipt of a benefit from the Pension Plan does not constitute a systemic conflict of interest
  • Ability to identify the limitations of the Directors’ own knowledge and the need for independent professional advice, and to understand and evaluate such advice

Both the Government and the Unions must ensure that their appointees, as a collective, have these personal characteristics.

Time Commitments:

At the beginning of each fiscal year, the Board will schedule at least four meetings to be held during the year. Each Board Director will be provided the date, time and location of these meetings. No other notice will be required for these meetings. It should be noted however that any director may request the Chair to convene a meeting of the Board.

All meetings of the Board will be held within the Province. A meeting of the Board may be held by means of telephone or such other communication facilities.

Additionally, the Board may from time to time appoint a committee or other advisory body, it deems necessary. Membership of such committees/advisory boards may be comprised of Board Directors and/or persons other than Directors. Any such committee/advisory board may formulate its own rules of procedure, subject to such regulations or directions as the Board may make, including the frequency of meetings. Presently, the following sub-committees have been established:

  • Governance/Human Resource Committee
  • Audit Committee
  • Investment Committee

A description of each of the above sub-committees is provided in the additional information section at the end of this profile.

Board members may also be expected to spend additional time to review materials and prepare for Board and Committee meetings.

Term:

Each Director must be a resident of Canada for the duration of his or her appointment.

All Directors will serve for a three-year term with the exception of the initial appointment of Directors. For the initial appointment of Directors:

  • Two Directors appointed by each of the Government and the Unions serve for an initial four-year term
  • Two Directors appointed by each of the Government and the Unions serve for an initial three-year term
  • Two Directors appointed by each of the Government and the Unions serve for an initial two-year term.

No later than six months before the expiry date of a Director’s term, the Chair provides written notice to the entity that appointed the Director of the expiry of the term.

A Director continues to serve until their representative is appointed or they resign, in which case the entity that appointed that Director, within 30 days of receive notice of the vacancy, appoints a successor Director to serve for the remaining term of that Director.

Additional Information:

The Public Service Pensions Act, 1991 was amended in December 2014, to provide for the establishment of a jointly trusteed arrangement for the Public Service Pension Plan (PSPP). These amendments established Government and the Unions as joint sponsors and the PSPP Corporation as the Trustee of the PSPP fund and administrator of the PSPP.

The PSPP is a defined benefit pension plan that provides pension coverage for approximately 27,000 active employees and retirement benefits to 20,000 pensioners. The PSPP Fund, which has assets of approximately $6 billion is invested in the broad capital markets by a team of 16 professional investment managers.

Oversight of the joint sponsorship agreement is provided by a sponsor body which consists of 14 persons as follows:

  • Seven representatives appointed by Government
  • Seven representatives appointed by the Unions

The PSPP Corporation Board of Directors is a governing body separate from the sponsor body, established as Trustee for the PSPP fund and responsible for the administration of the pension plan.

Sub-committee Mandate and Structure Summary

Governance and Human Resources Committee:

The Governance and Human Resources Committee (“the Committee”) of the Public Service Pension Plan Corporation (“the PSPPC”) is responsible for providing expert advice to the PSPPC Board of Directors (“the Board”) so as to achieve the PSPPC’s corporate goals and objectives. The Committee enables the Board to fulfill its obligations by providing a focus and ongoing pursuit of best practices regarding corporate governance and human resource policy, procedures, and practices. The Committee provides a particular focus on:

  • Corporate governance and ethical behaviours
  • Human Resources policies and practices
  • Executive review, compensation, and succession
  • Corporate communication practices and policies
  • Succession planning for the Committee

The Committee is composed of five (5) voting members, and two (2) non-voting members. These members include:

  • The Committee Chair (the “Chair”), who is a PSPPC Director, but not the Board Chair
  • The Board Chair, who is an ex-officio member of the Committee
  • Three (3) additional PSPPC Directors
  • The Board Vice-Chair, who is an ex-officio, non-voting member of the Committee
  • The PSPPC Chief Executive Officer, who is an ex-officio, non-voting member of the Committee

Appointments to the Committee and identification of the Chair are made by the Board in consideration of the competency profile of the Committee as a whole and the expertise of potential advisors to the Committee, including both PSPPC staff and external consultants. All members must be independent of day to day operations of the PSPPC. Any member of the Committee may be removed and replaced at any time at the discretion of the Board. The membership of Committee members will cease with their term on the Board. Mid-term appointments will be made by the Board as required to fill vacant positions.

Audit Committee:

The Audit Committee (“the Committee”) of the Public Service Pension Plan Corporation (“the PSPPC”) is responsible for providing expert advice to enable the PSPPC Board of Directors (“the Board”) to fulfill its oversight responsibility in relation to the PSPPC’s financial reporting, accounting systems and internal controls. The Committee provides a particular focus on:

  • Reviewing and recommending the annual financial statements
  • Defining the scope of the external audit
  • Overseeing the engagement and work of the external auditor
  • Overseeing the reliability of the PSPPC’s accounting systems
  • Overseeing the development of a control framework including the development of comprehensive internal controls
  • Overseeing the assessment of the internal control framework
  • Reviewing and recommending changes in major accounting policies
  • Oversight of risk management in areas relating to the Committee’s specific mandate
  • Developing a risk management profile including a process for assessing the risk of fraud
  • Oversee the reporting requirements to Government with respect to the pensions liability
  • Monitoring organizational standards on integrity and behavior
  • Advising the Board on succession planning for the Committee

The Committee is composed of up to five (5) voting members, and three (3) ex-officio, non-voting members. These members include:

  • The Committee Chair (the “Chair”), who is a PSPPC Director, but not the Board Chair
  • Two (2) to four (4) other PSPPC Directors
  • The Board Chair, who is an ex-officio, non-voting member
  • The Board Vice-Chair, who is an ex-officio, non-voting member
  • The PSPPC Chief Executive Officer (“CEO”), who is an ex-officio, non-voting member

Appointments to the Committee and identification of the Chair are made by the Board in consideration of the competency profile of the Committee as a whole and the existing expertise of the advisors to the Committee, including both PSPPC staff and external consultants. The Board will use its best efforts to avoid overlapping membership between the Committee and the Investment Committee. All members must be independent of day to day operations of the PSPPC, with the exception of the PSPPC CEO. Any member of the Committee may be removed and replaced at any time at the discretion of the Board. Consistent with its mandate, each voting member of the Committee shall be financially literate. In this context, an individual is considered to be financially literate if they have the ability to read and understand a set of financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of the issues that can reasonably be expected to be raised by the PSPPC and the Plan. The membership of Committee members who are PSPPC Directors will cease with their term on the Board. Mid-term appointments will be made by the Board as required to fill vacant positions.

The Investment Committee (“the Committee”) of the Public Service Pension Plan Corporation (“the PSPPC”) is responsible for providing expert advice to the PSPPC Board of Directors (“the Board”) on the investment management and oversight of the PSPP Fund (“the Fund”) so as to achieve the PSPPC’s corporate goals and objectives. The Committee also monitors and reports on the implementation of investment policies approved by the Board, reviews at a minimum quarterly, more often if market events require, the performance of the Fund, provides to the Board annually the revision recommendations for the Statement of Investment Policy & Procedures (“SIP&P”), and requests research and analysis from staff in order to fulfill its responsibilities and ensure due diligence. The Committee provides a particular focus on:

  • Investment policy and goals
  • Asset mix
  • Investment strategies and mandates for external investment managers
  • The effectiveness of the investment policies, strategies, and mandates in achieving the PSPPC’s corporate goals and objectives
  • The appointment and removal of external investment managers and consultants
  • Advising the Board on succession planning for the Committee
  • Advising the Board on any other matters it may refer to the Committee

The Committee is composed of six (6) to eight (8) voting members, and three (3) ex-officio, non-voting members. These members include:

  • The Committee Chair (“the Chair”) who is a PSPPC Director, but not the Board Chair
  • Up to three (3) additional PSPPC Directors
  • Two (2) to four (4) external independent investment experts – appointed by the Board, upon the recommendation of the Committee
  • The Board Chair, who is an ex-officio, non-voting member
  • The Board Vice-Chair, who is an ex-officio, non-voting member
  • The PSPPC Chief Executive Officer (“CEO”), who is an ex-officio, non-voting member

Appointments to the Committee and identification of the Chair are made by the Board in consideration of the competency profile of the Committee as a whole and the existing expertise of the advisors to the Committee, including both PSPPC staff and external consultants. Any member of the Committee may be removed and replaced at any time at the discretion of the Board. Consistent with its mandate, each voting member of the Committee shall be financially literate. In this context, an individual is considered to be financially literate if they have the ability to read and understand a set of investment management reports that present the breadth and level of complexity of issues that are commensurate with the complexity of the Fund’s investment portfolio. The membership of Committee members who are PSPPC Directors will cease with their term on the Board. External Committee members will be appointed to a term(s) not exceeding three (3) years and will serve at the pleasure of the Board. Mid-term appointments will be made by the Board as required to fill vacant positions.

Current Members:
NameTitleAppointment TypeAppointment Date (yyyy/mm/dd)Expiry Date (yyyy/mm/dd)
Andrews, Mr. NoelGovernment AppointeeMinisterial2015-10-292017-03-30
Galway, Ms. MaryMemberMinisterial2015-03-272018-03-31
Groch, Mr EmilianMemberMinisterial2017-06-222020-06-22
Hamilton, Ms DeniseMemberMinisterial2017-06-222020-06-22
Hamilton, Ms. GailGovernment AppointeeMinisterial2015-10-192017-03-30
Jones, Mr. DavidMemberMinisterial2015-03-272018-03-31
Miller, Ms. Ann MarieNon-Union AppointeeMinisterial2015-10-292018-03-30
Perry, Ms. JocelynGovernment AppointeeMinisterial2015-10-192018-10-31
Sullivan, Mr. LoyolaMemberMinisterial2015-03-272019-03-31
Williams, Mr. GeoffNon-Union AppointeeMinisterial2015-10-192018-03-30

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