OMERS Overview and Operations

OMERS is one of Canada's largest pension funds, with over $130 billion in assets under management. Its primary goal is to provide retirement income to its members.

The organization was established in 1962 and is administered by a board of trustees, which includes representatives from the Ontario government and OMERS members. This board is responsible for making key decisions about the fund's investments and operations.

OMERS operates on a defined benefit pension plan, which means that members receive a guaranteed benefit based on their salary and years of service. This approach provides a predictable income stream for retirees.

OMERS Governance is a crucial aspect of the pension plan. The Special Advisor, appointed by the Minister of Municipal Affairs and Housing, will evaluate the current OMERS governance model to assess its effectiveness.

The Special Advisor will examine the OMERS Sponsors Corporation (SC) Board's decision-making processes, including its engagement with employer/employee on plan decisions. The review will also assess the composition of the SC Board and its impacts on fair and equitable decisions for plan members.

The Special Advisor will have expertise in pension plan administration and collective bargaining, and will be independent of the government, employers, and employees. They will have the executive leadership skills, technical expertise, and stakeholder relationship management competencies to consult with diverse stakeholder groups.

The review will focus on the effectiveness of the OMERS Administration Corporation (AC) Board in managing Plan assets and making investment decisions. The Special Advisor will also assess the composition of the AC Board and its impacts on plan performance.

The Special Advisor will prepare a final report with recommendations for strengthening the governance of the OMERS pension plan. The report will reflect the perspectives of Employer/Employee organizations and best practices in the field of pension plan governance.

Here are the key areas the Special Advisor will examine:

The Special Advisor will be remunerated at a rate of up to $1500 per diem for a maximum of 235 days, amounting to a total remuneration of up to $352,500.

In March 2017, OMERS acquired a stake in Kemble, the UK holding company of Thames Water.

This acquisition was a significant move for OMERS, marking a major investment in the UK water business. However, things took a turn for the worse in 2023 when Thames Water became embroiled in a financial crisis.

In May 2024, OMERS issued a "full writedown" of its 31.7% stake in Kemble, signalling that the shares were now worth nothing.

OMERS also made a notable acquisition in November 2023, purchasing a 5% indirect stake in Maple Leaf Sports & Entertainment (MLSE) for $400 million.

This stake was purchased through a 20% direct investment in Kilmer Sports Inc (KSI), which is owned by MLSE Chairman Larry Tanenbaum.

Here's a list of other notable investors that have partnered with OMERS on various deals:

OMERS is a Canadian pension plan with a defined benefit structure, meaning members receive a guaranteed benefit based on their salary and years of service.

The plan is sponsored by the Ontario government and serves over 430,000 active and retired members.

OMERS has a strong focus on long-term investing, with a 30-year investment horizon.

The organization has a diverse investment portfolio, with over 80% of assets invested in public markets, including stocks and bonds.

OMERS has a significant presence in private markets, with over 15% of assets invested in private equity, real estate, and infrastructure.

OMERS Talent is a key component of the OMERS organization, focused on developing and supporting the skills of its employees. With a diverse range of training programs and resources, OMERS Talent aims to equip its staff with the skills they need to succeed in their roles.

OMERS offers a comprehensive suite of training programs, including leadership development, technical skills, and cultural competence. These programs are designed to support employee growth and development at every stage of their careers.

Employee engagement is a top priority at OMERS, with a focus on creating a positive and inclusive work environment. This includes initiatives such as flexible work arrangements, employee recognition programs, and opportunities for feedback and growth.

OMERS has a strong commitment to diversity, equity, and inclusion, with a goal of creating a workplace culture that values and respects the perspectives and backgrounds of all employees. This commitment is reflected in initiatives such as mentorship programs and employee resource groups.

OMERS Talent has a dedicated team of professionals who work closely with employees to understand their development needs and provide personalized support. This includes coaching, mentoring, and career guidance to help employees achieve their career goals.

CUPE Ontario is a strong advocate for OMERS plan members. They represent 125,000 of the 289,000 active plan members.

CUPE Ontario has been critical of OMERS' executive compensation practices, citing high pay for underperforming investments. They've been calling for an independent and transparent review of OMERS.

According to a CUPE Ontario report, OMERS pays some of the highest absolute rates for its top executives. This is despite being one of the smaller plans in terms of assets under management.

The report found that OMERS paid top executives more than twice the average compensation, per billion dollars of assets under management, of all comparable plans. This is a significant disparity.

CUPE Ontario President Fred Hahn has expressed concern about the impact of poor investment returns on pension benefits. He notes that the average OMERS pensioner received just over $24,000 in 2020.

The union has been calling for a review of OMERS, led by worker and employer sponsors. They believe this is necessary to ensure transparency and accountability in the plan's administration.

CUPE Ontario has a long history of advocating for OMERS plan members. Last year, they released a report highlighting the plan's underperformance.