Toronto Investment Board
The full agenda, as filed
All 7 items in the clerk’s order. Each carries the city’s own words: the staff recommendation, what the body decided, and its status. Nothing below is written by us.
IB3.1received
Presentations from Investment Managers
Presentations will be given by the following Investment Managers: - Connor, Clark, & Lunn (Active Fixed Income); and - Leith Wheeler (Active Fixed Income).
The Toronto Investment Board received the presentations for information.
IB3.2adopted
Sinking Fund and Long Term Fund - Performance and Compliance Update for the First Quarter of 2023
As required by the City's Investment Policy, the purpose of this report is to provide the Toronto Investment Board ("Board") with the following: 1. The performance of the Sinking Fund and Long Term Fund for the first quarter of 2023. 2. Investment Policy and Plan Compliance certificates and reports for the first quarter of 2023.
The Toronto Investment Board received the report (June 1, 2023) from the Director, Capital Markets for information.
Staff recommendation as filed
The Director, Capital Markets recommends that: 1. Toronto Investment Board receive this report for information.
IB3.3adopted
Investment Manager and Other Updates
This report provides the Toronto Investment Board ("Board") with an update regarding activities involving the investment managers and related parties. It includes changes to the investment manager mandates, contracts, and funding along with other related items. There are some developments with two of the global equity funds provided by Fiera Capital Corporation ("Fiera"). The first change is relatively minor and involves updating the contracts involving the Oakmark Global Pooled Fund II ("Oakmark") global equity fund. The second change involves Fiera's decision to close the Fiera Global Equity Common Contractual Fund ("Fiera CCF"). These two items are explained in more detail in the report. It is recommended that the Chair or Vice Chair be authorized to sign documentation necessary to complete the Oakmark contracts while the options with the Fiera CCF will be brought back to the Board at a later date. The process to hire an Environmental, Social, and Governance (ESG) data service provider has been completed and has been moved to a separate report. An update of the current funding status of Long-Term Fund ("LTF") and Sinking Fund ("SF") is provided in Attachment 1 to this report for the Board's review.
The Toronto Investment Board: 1. Authorized, after review by external legal counsel, the Chair or the Vice Chair of the Investment Board to execute amended agreements for the Oakmark Global Pooled Fund II on behalf of the Investment Board.
Staff recommendation as filed
The Director, Capital Markets recommends that: 1. Toronto Investment Board, after review by external legal counsel, authorize the Chair or the Vice Chair of the Investment Board to execute amended agreements for the Oakmark Global Pooled Fund II on behalf of the Investment Board.
IB3.4adopted
The purpose of this report is to update the Toronto Investment Board ("Board") on the progress to date regarding the hiring of external investment managers in the Real Assets category.
The Toronto Investment Board received the report (May 25, 2023) from the Director, Capital Markets for information.
Staff recommendation as filed
Director, Capital Markets recommends that: 1. The Toronto Investment Board receive this report for information.
IB3.5adopted
Environmental, Social, and Governance Reporting Update
The Toronto Investment Board authorized the Director, Capital Markets to initiate a non-competitive procurement to retain the recommended third-party information provider to provide metrics in the area of assessing Environmental, Social, and Governance performance. This non-competitive procurement was recommended as the result of an unsuccessful invitational Request for Proposal in early 2021. This procurement would facilitate a response to the City Council request to the Toronto Investment Board and the Chief Financial Officer and Treasurer to develop a process to monitor and report on external investment firms hired by the Board are compliant with the terms of the Investment Policy with respect to Environmental, Social, and Governance factors. The Toronto Investment Board selected a vendor, and an alternate vendor, at its meeting in September 2021 to initiate the non-competitive procurement process. An agreement was reached and a three-year contract was signed the vendor in April 2023. Since an agreement has been reached, it can be disclosed that the vendor is MSCI Inc. along with its subsidiary company MSCI ESG Research LLC. A general description of the Environmental, Social, and Governance Ratings Service can be found in Attachment 1. In addition, the agreement also includes the MSCI Carbon Portfolio Analytics reporting package that is part of MSCI's Climate Lab Enterprise. Carbon Portfolio Analytics reporting from MSCI Environmental, Social, and Governance Research helps investors understand, measure and manage carbon risk at the portfolio, sector, and company level. A brief overview of this tool can be found in Attachment 2. Both of these MSCI products are provided on a managed service basis. This requires City staff to upload the portfolio information to MSCI via a secured portal and then MSCI will generate reports on each portfolio as well as on a consolidated basis for both the Long-Term Fund and the Sinking Fund. Comparison information against a benchmark index is also provided. The information from MSCI is proprietary and confidential. There are a number of identifiable individual companies and governments in their detailed reports. The agreement with MSCI allows for the viewing and use of the information on a confidential basis by a limited number of City staff, the Board, and City Council. The contract does allow for the public use of general consolidated information on a limited basis. The process to score the portfolios and generate reports via the MSCI system was initiated in May 2023, however final reports were not received until May 31, 2023 which is close to the deadline for this report. Staff are still reviewing the materials however some preliminary consolidated data is provided in this report as well as in Confidential Attachment 1 and Confidential Attachment 2.
The Toronto Investment Board: 1. Directed that Confidential Attachments 1 and 2 to the report (June 4, 2023) from the Director, Capital Markets remain confidential in their entirety, as they pertain to the security of property belonging to the City or one of its agencies or corporations.
Staff recommendation as filed
The Director, Capital Markets recommends that: 1. The Toronto Investment Board direct that the confidential information contained in Confidential Attachment 1 and Confidential Attachment 2 remain confidential in its entirety, as it contains information that involves the security of property belonging to the City or one of its agencies or corporations.
IB3.6adopted
Asset Mix - Historical Background Review
At its meeting on March 9, 2023, the Toronto Investment Board ("Board") discussed the background of the current Asset Mix contained in the current Council-adopted Investment Policy (Attachment 1). The Investment Consultant (Aon) suggested providing a historical background review of the work completed on Asset Mix since the creation of the Toronto Investment Board ("Board") in 2017. Attachment 2 provides a summary of the multiple reviews and the results to date. Full reports and presentations can be found by following the links in the Decision History section below.
The Toronto Investment Board received the report (May 27, 2023) from the Director, Capital Markets for information.
Staff recommendation as filed
The Director, Capital Markets recommends that: 1. Toronto Investment Board receive this report for information.
IB3.7received
Making Electronic Participation for Council and its Local Boards Permanent
At its meeting on March 21, 2023, the Executive Committee considered Item EX3.7 and made recommendations to City Council. Item EX3.7 was considered and amended by City Council at its meeting on March 29, 30, and 31, 2023. Summary from the report (March 7, 2023) from the City Clerk: The purpose of this report is to recommend amendments to the Council Procedures to make electronic participation a permanent option for meetings of City Council and its Committees, and to authorize local boards to make amendments to their own rules of procedure.
The Toronto Investment Board received the letter (June 7, 2023) from the City Clerk for information.
Staff recommendation as filed
The City Clerk transmits the Decision Letter from City Council. City Council on March 29, 30 and 31, 2023, adopted the following: 1. City Council amend Toronto Municipal Code Chapter 27, Council Procedures, to permit electronic participation in all meetings and provide that: a. any member participating in the meeting electronically to be deemed present for the purposes of determining whether a quorum is present under 27-5.12A, and for the purposes of voting on any matter put to a vote under 27 12.2A, and for all other purposes; and b. any member participating in the meeting electronically to be entitled to participate in any portion of the meeting closed to the public in accordance with 27-5.15. 2. City Council amend the Council Procedures to change the time required to achieve quorum from 15 minutes to 30 minutes. 3. City Council amend the Council Procedures to permit members of the public to participate electronically at meetings where electronic participation occurs and in a manner as determined by the Clerk. 4. City Council authorize local boards governed by the City of Toronto Act, 2006, to amend their own rules of procedure to permit electronic participation by board members and the public, and to change the time required to achieve quorum from 15 minutes to 30 minutes, and authorize such boards to continue to meet electronically in accordance with the previously adopted electronic participation rules past the May 9, 2023 deadline until they can meet to consider procedural amendments. 5. City Council, despite any procedural rules that may allow electronic participation in meetings of Council, its committees or boards, nevertheless encourage Council members to attend meetings in person except when there is a rationale to participate electronically.