MESSAGE FROM THE CHAIRPERSON
MESSAGE FROM THE CHAIRPERSON On behalf of the Board of Directors (the Board) and the management team of Vestcor Inc. (Vestcor), I am pleased to introduce our 2021 Annual Report. This Annual Report provides a thorough accounting for our pension and benefits administration, investment, and corporate service operating activities in a format consistent with our prior Annual Reports. The Vestcor Board of Directors is assisted in its responsibilities for the independent governance, stewardship and strategic direction of our company by three Committees: the Audit Committee, the Human Resources & Compensation Committee and the Governance Committee. Ad-Hoc Committees are formed from time to time to assist with special Board projects and initiatives.
OUR LONG-TERM SUCCESS CONTINUES Vestcor realized another successful year in 2021 under the guidance and stewardship of our Board of Directors. The Board remains very pleased that Vestcor has been able to continue to provide the essential services that our clients and their members depend on considering the challenges that we, and the partners and stakeholders, experienced through the ongoing COVID-19 pandemic. Long-term investment results on both a risk and return basis remained strong and well in excess of our clients' targets. Our Administration Team was successful in further leveraging the capabilities of our new more modernized administration and pension payroll system to meet client service targets and to successfully automate a number of more complex shared risk pension plan client calculations. Most importantly, member service survey scores have continued to remain excellent. Our independent, not-for-profit business model continues to align well with our clients’ objectives while also delivering excellent value through low expenses and a customized focus on client goals and service requirements. Investment management related fees continue to be well aligned with the value provided to clients being above their investment policy targets and benchmarks. We were very pleased to have this value proposition confirmed during the year with the addition of two new shared risk pension plan clients to our investment management services platform.
SPECIFIC 2021 GOVERNANCE ACTIVITIES The Vestcor Board of Directors and their respective Committees continued to provide input and oversight with respect to annual corporate business plan goals and objectives and their link to industry best practices. During the year, our Committee Chairs underwent a rotation process as part of our ongoing Board succession planning and professional development activities. Updated strategic human resource and related succession plans continue to be reviewed on an annual basis. The Board continues to focus on executive development and succession planning to ensure we remain well positioned for future senior management retirements or departures. We were very pleased that this focus led to the seamless integration of an internal candidate as part of an external search process for a new Chief Financial Officer role this year upon the retirement of the long-serving incumbent. Additional governance improvement activities that were completed during the past year included a full review of all the Terms of Reference, Policies, and Guidelines that guide our Board’s activities, and a full review, risk appetite assessment and update to our corporate Enterprise Risk Management Framework. As noted in my letter in last year’s Annual Report, the Board appointed an Ad-Hoc Compensation Review Committee to complete a review of our overall Compensation Principles, Philosophy, and related policies. The Committee retained the nationally recognized firm Willis Towers Watson to assist with this review. In advance of the study proceeding, the Committee approved a peer comparison group that consisted of a combination of nationally based internal pension fund managers with similar sized assets under management and Atlantic Canadian professional service businesses of similar complexity. This work ensures that our compensation polices will continue to allow us to attract and retain the professionals we require while meeting industry best practices. The study resulted in modifications to the salary bands of a few specific positions to allow us to remain competitive with the approved peer group, and a restructuring of the performance incentive plan in 2021 to align with recent industry
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