Toronto Investment Board

The full agenda, as filed

All 8 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.

• IB8.1received

  Committee Member Roles and Meeting Rules

  Carlie Turpin, Manager, Boards, Tribunals and Council Advisory Bodies, will provide a presentation on the rules of procedure for meetings of the Toronto Investment Board.

  The Toronto Investment Board received the item for information.

• IB8.2adopted

  Review of the Global Equity Mandates - Implementation Rationale

  The purpose of this report is to provide the Toronto Investment Board ("Board") with a review of the global equity mandates and explain the rationale underlying the selection of investment managers for this asset class. A presentation by the investment consultant (Aon) provides background and decision making of the Toronto Investment Board (Board) in 2018.

  The Toronto Investment Board: 1. Received the report (August 30, 2024) 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.

• IB8.3adopted

  Sinking Fund and Long Term Fund - Performance and Compliance Update for the Second Quarter of 2024

  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 Sinking Fund and Long Term Fund performance for the second quarter of 2024. 2. Investment Policy and Plan Compliance check for the second quarter of 2024.

  The Toronto Investment Board: 1. Received the report (September 11, 2024) 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.

• IB8.4received

  Presentations from Investment Managers

  Presentations will be given by the following Investment Managers: - Fiera Global Equity (CCF) Fund (Global Equity) - Fiera Harris/Oakmark Fund (Global Equity)

  The Toronto Investment Board received the item for information.

• IB8.5adopted

  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. With regard to Fiera Capital Corporation ("Fiera") and the closing of the Fiera Global Equity Common Contractual Fund ("Fiera CCF"), after several months of review by the investment consultant, external legal, tax advisors and City staff a decision has been reached to proceed with the in-kind transfer of the assets of the old fund to a new fund that has a Canadian pooled fund structure, which was determined to be the most efficient structural option from a tax, cost and scale perspective. The City's external legal advisor and the tax advisor have reviewed the documentation and transaction view that there are no risks prohibitive to the City entering into the transaction from a legal or tax perspective in the new fund. At the previous meeting of the Board, the Chair or Vice Chair were authorized to execute the necessary documentation to bring this transaction into effect. A Letter of Direction has been approved, signed and sent to Fiera to proceed with the transaction. Fiera is targeting the transfer to take place in mid-September, however, may take up to three months to effectively complete the transaction. City staff continue to transfer funds from the Short-Term Fund (managed internally) and into the Long-Term Fund (managed by the Board) as well as re-balancing of the Sinking Fund. In addition, initial funding for a manager in the Real Assets category was completed. A summary of the transfers completed after June 30th is outlined in this 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.

  The Toronto Investment Board: 1. Received the report (September 8, 2024) 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.

• IB8.6adopted

  Real Assets and Investment Plan Update

  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 necessary reviews, negotiations and documentation has been completed with a second investment manager in this category. At this stage we can publicly disclose the name of the new Global Real Estate manager as CBRE Investment Management. This is in addition to the announcement of UBS Asset Management made at the previous meeting of the Board. An updated Investment Plan with the names of the new Global Real Estate managers is included in Attachment 1 for review and adoption. The Investment Plan is a legislative requirement (Ontario Regulation 360/15 under the City of Toronto Act) and was last reviewed and adopted by the Board in June 2021. Attachment 2 and Attachment 3 have been provided by CBRE Investment Management and UBS Asset Management respectively and are a summary of each individual mandate.

  The Toronto Investment Board: 1. Adopted the updated Investment Plan as provided in Attachment 1 of this report (September 3, 2024).

  Staff recommendation as filed

  The Director, Capital Markets recommends that: 1. The Toronto Investment Board adopt the updated Investment Plan as provided in Attachment 1 of this report.

• IB8.7adopted

  Environmental, Social, and Governance Reporting Update

  The Toronto Investment Board (Board) engaged MSCI Inc. (MSCI) and its subsidiary MSCI ESG Research LLC as its ESG Ratings Service provider. The agreement was in response to City Council's request to the Toronto Investment Board and the Chief Financial Officer and Treasurer to monitor and report on the performance of the external investment firms hired by the Board with respect to ESG factors according to the Investment Policy. In addition, the agreement includes the MSCI Carbon Portfolio Analytics reporting package that is part of MSCI's Climate Lab Enterprise, a comprehensive set of climate data and analytics. Carbon Portfolio Analytics reporting from MSCI ESG Research helps investors understand, measure and manage carbon risk at the portfolio, sector and company level. Both MSCI products are being provided on a managed service basis whereby City staff provide portfolio information to MSCI via secured channels and MSCI generate reports on a portfolio and consolidated basis for the Long-Term Fund (LTF) and Sinking Fund (SF). Benchmark index information is also provided for comparison. 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. Portfolio holdings as at June 30, 2024 were submitted to MSCI in August 2024. Results were received as at the date of this report. Summary data is provided in this report as well as in Confidential Attachments 1, 2, 3 and 4.

  The Toronto Investment Board: 1. Directed that the confidential information contained in Confidential Attachment 1, Confidential Attachment 2, Confidential Attachment 3, and Confidential Attachment 4 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.

  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, Confidential Attachment 2, Confidential Attachment 3, and Confidential Attachment 4 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.

• IB8.8adopted

  Proposed 2025 Schedule of Toronto Investment Board Meetings

  In accordance with Section 25 of the Toronto Investment Board Procedures By-law, regular meetings of the Board are determined by the Board and a schedule of those meetings shall be publicly available by the first Board meeting in each calendar year. The Toronto Investment Board's meetings will be held as hybrid meetings with members participating in person and remotely. On July 24 and 25 2024, City Council approved the 2025 annual schedule of meetings for City Council and its Committees. The meeting schedule is available on the City of Toronto's website at www.toronto.ca/council.

  The Toronto Investment Board: 1. Approved the following meeting dates for 2025: - Monday, March 17, 2025 - City Hall, Committee Room 2/Video Conference - Tuesday, June 24, 2025 - City Hall, Committee Room 2/Video Conference - Friday, September 26, 2025 - City Hall, Committee Room 2/Video Conference - Friday, December 12, 2025 - City Hall, Committee Room 2/Video Conference

  Staff recommendation as filed

  That the Toronto Investment Board approve the following meeting dates for 2025: - March 17, 2025 - City Hall, Committee Room 2/Video Conference - Tuesday, June 24, 2025 - City Hall, Committee Room 2/Video Conference - Friday, September 26, 2025 - City Hall, Committee Room 2/Video Conference - Friday, December 12, 2025 - City Hall, Committee Room 2/Video Conference