Ontario Teachers' Pension Plan
The Ontario Teachers' Pension Plan Board (French: Régime de retraite des enseignantes et des enseignants de l'Ontario)[5] is an independent organization responsible for administering defined-benefit pensions for school teachers of the Canadian province of Ontario. Ontario Teachers' also invests the plan's pension fund and it is one of the world's largest institutional investors, acting as a partner organization of the World Economic Forum.[6] The plan is a multi-employer pension plan, jointly sponsored by the Government of Ontario and the Ontario Teachers' Federation.
Ontario Teachers' achieved a 11.1% one-year total-fund net return in 2021 and achieved its ninth consecutive fully funded year.[7]
History[edit]
Ontario Teachers' was established on January 1, 1990.[8] Until then, Ontario teachers' pensions had been sponsored solely by the Ontario government. Assets of the plan had been invested in government bonds only. Currently, it invests globally in fixed income, public and private equity markets, real estate, infrastructure, natural resources, credit and venture capital through Teachers' Venture Growth (TVG).[9]
Organization[edit]
The plan administers the pensions for some 330,000 teachers, principals, and school administrators, and it pays pensions to some 148,000 retirees.[10] In 2020, $6.74 billion in benefits was paid to members. Ontario Teachers' is headquartered in Toronto, with regional offices in London, New York, Hong Kong, Singapore, and Mumbai.[11] Effective January 1, 2020, Jo Taylor succeeded Ron Mock as President and Chief Executive Officer.[12] The Chair of Ontario Teachers' is Steve McGirr.[13]
Investments[edit]
One of Canada's largest institutional investors, Ontario Teachers' reported having $249.8 billion in net assets as of June 30, 2023.[7] It has an excellent track record for investment performance, with an average annual return of 9.4 per cent since inception in 1990.[7]
Ontario Teachers' owns and manages a diversified portfolio of Canadian and international assets. Through its fully owned real estate subsidiary, Cadillac Fairview, Ontario Teachers' owns properties that include the Toronto-Dominion Centre, Toronto Eaton Centre, the Pacific Centre in Vancouver, the Rideau Centre in Ottawa, and White City Place in London, UK.[14] Through its private equity investment arm, Private Capital, Ontario Teachers' owns interests in companies such as Munchkin, PODS, Techem, GFL Environmental, and Shearer's Foods.[15] In 2001, Ontario Teachers' Pension Plan and Caisse de dépôt et placement du Québec were the sole two investors in a US$360 million fund raised by Canadian company Cordiant Capital.[16] Ontario Teachers' also owned Camelot Group PLC, which held an exclusive licence to operate the UK National Lottery until January 31st 2024. It acquired a share of the Irish National Lottery in 2014.
Ontario Teachers' owns a substantial portfolio of infrastructure assets, including stakes in Birmingham Airport, Bristol Airport, Copenhagen Airport, and London City Airport, as well as international water and power utilities. Alongside PSP Investments, Ontario Teachers' owns Cubico Sustainable Investments, a leading provider of renewable energy.[17]
From 2003 to 2012, the fund was the principal owner of Maple Leaf Sports & Entertainment, the parent organization of the Toronto Maple Leafs, Toronto Raptors, Toronto FC and Toronto Argonauts.[18][19] The franchise was sold to BCE Inc. and Rogers Communications in 2012.[20]
In 2017, it acquired Mémora Servicios Funerarias, a Spanish funeral provider, from 3i.[21]
In 2019, Ontario Teachers', along with Amazon and others, assisted in financing to help the New York Yankees regain ownership control of their regional sports network, the YES Network, resulting in a minority ownership in the network.[22]
In 2022, the pension fund was targeting investments in India, opening an office in Mumbai in September. It had $178.5 billion in assets total.[23]
In 2021 and 2022, Ontario Teachers' invested US$75 million in FTX and US$20 million in FTX.US respectively, through its Teachers' Venture Growth platform.[24] Following FTX's collapse in early November 2022, Ontario Teachers' stated that it will write off the entirety of its US$95 million investment by the end of 2022.[25]
Media coverage[edit]
On the January 12, 2004 episode of Rick Mercer Report, comedian Rick Mercer had a short segment about the Ontario Teachers' Pension Plan, in which he humorously contrasted the plan's beneficiaries (i.e. teachers) with the investments the plan had made, including shopping malls and the tobacco industry.[29]
On December 2, 2008, New York lawyer Marc Stuart Dreier was arrested at Ontario Teachers' Toronto offices and charged with impersonating, through his words and by the use of business cards, Michael Padfield, a senior lawyer with the pension plan. A receptionist in the Ontario Teachers' offices had become suspicious and notified Toronto police. Dreier was attempting to close a sale of forged Ontario Teachers' promissory notes, worth US$44.7 million, by meeting with the buyers right in the Ontario Teachers' offices.[30]
A 2012 article[31] in The Economist titled "Maple Revolutionaries" about Canada's largest public pension funds features Ontario Teachers', saying it pioneered a new style of investing in the 1990s by managing more of its portfolio internally and doing more direct investing. Then-Ontario Teachers' CEO Jim Leech called Canadian pension funds a "new brand of financial institution" likened to depoliticized sovereign-wealth funds.