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  Pension Fund Committee
  
 

Canadian Utilities Limited (the “Corporation”) will have a Management Pension Committee (the “Committee”), appointed by the President and Chief Executive officer (“CEO”) and reporting to the Corporation’s Board Pension Committee and the CEO, to oversee the operations of The Retirement Plan for Employees of Canadian Utilities Limited and Participating Companies (Plan 1 and Plan 2) (the "Plans") in accordance with the Plans’ respective terms. The Committee will consist of the Senior Vice President & Chief Financial Officer (“CFO”); Senior Vice President & Chief Administrative Officer (“CAO”); Vice President, Finance & Controller; Vice President, Human Resources; Treasurer (all being officers or employees of the Corporation); and other officers or employees as approved by the CEO and CFO. The CFO will act as the Committee Chairman. Invited guests may also attend meetings of the Committee at the discretion of the Committee Chairman. Invited guests of the Committee are not entitled to vote on resolutions of the Committee.

Meetings

The Committee will meet at least semi-annually, and at such other times as necessary, to fulfill the mandate of the Committee. Reasonable notification for meetings of the Committee shall be provided. Such meetings may be held in person, by telephone or other communication device. Minutes of meetings will be kept by a person designated by the Committee Chairman to act as secretary, and Minutes shall be circulated to members of the Committee and the CEO on a timely basis.

Responsibilities

The primary responsibilities of the Committee are to:

  • administer and control the operations of the Plans; and
  • ensure that the Corporation fulfills its obligations as administrator of the Plans.

The Committee will report to the Board Pension Committee and to the CEO, as provided in the Pension Governance Policy of the Corporation. The Committee will develop procedures to assist it in carrying out it duties.

Mandate

The Management Pension Committee shall serve as an advisor to and a forum for the receipt and exchange of information between the Board, the Board Pension Committee, management of the Corporation, and the Advisors/Service Providers to the Plans, and shall supervise the administration of the Plans and control their operation in accordance with their terms.

The mandate of the Committee, or of specific members of the Committee in relation to the Functional Departments for which they are responsible, are as follows:

  • To coordinate the activities of the Functional Departments and Advisors/Service Providers (see the Corporation’s Pension Administration Mandates), as necessary, to ensure appropriate and efficient administration of the Plans and compliance with legislative requirements, administrative policies and the terms of the Plans.
  • To formulate, review, assess on an annual basis and approve the mandates relating to the Plans, in such form as the Committee shall determine, for the following:
    • the Functional Departments, who will perform discreet functions for or provide strategic guidance to the Board Pension Committee and the Committee, as required; and
    • the Advisors/Service Providers, who shall be responsible for provision of specific advice and/or services as required by the Board Pension Committee, the Committee or the Functional Departments.

and to review, assess and recommend to the Board Pension Committee any necessary or desirable changes to the mandates for:

    • the Committee; and
    • the Corporation’s DC Pension Advisory Committee.
  • To implement, manage, periodically review and assess the policies for (i) benefit design and liability management, (ii) funding, (iii) investment, and (iv) the internal controls to ensure compliance with such policies, of the Plans, as established by the Board Pension Committee.
  • To recommend to the Board Pension Committee whether or not to terminate any fund manager not meeting their agreed upon performance mandate.
  • To employ such other Advisors/Service Providers and to obtain such clerical, advisory, legal and actuarial services, on the basis provided in the Pension Governance Policy of the Corporation, as it may deem necessary or appropriate in carrying out the provisions of the Plans, satisfying the Corporation's fiduciary obligations as administrator of the Plans and ensuring compliance with all applicable laws and regulations.
  • To act as a liaison between the Board Pension Committee and the DC Pension Advisory Committee.
  • To formulate performance evaluation criteria for, and where applicable to assess the performance of, Advisors/Service Providers, and other counsel, advisors and agents employed to assist in operation, administration and interpretation of the Plans.
  • To implement appropriate controls to monitor and assess the reasonableness and competitiveness of any fees or expenses charged to the Plans or paid by Members.
  • To receive periodic summary reports reviewing globally the qualifications and performance of the Functional Departments, Advisors/Service Providers and others involved in the day-to-day administration of the Plans, from the CFO and CAO relating to their respective areas of responsibility.
  • To maintain an awareness and understanding of existing, new and pending pension law and regulatory requirements.
  • To determine internal controls and procedures to ensure the filing of all required regulatory filings with respect to the Plans.
  • To bring to the attention of the CEO and the Board Pension Committee the Committee’s review of errors and omissions noted in the operations of the Plans.
  • To report at least annually to the Board Pension Committee in respect of those matters specified in the Board Pension Committee mandate and such other matters as may be directed by the Board Pension Committee from time to time.
  • To periodically evaluate and assess the existing governance structures for the Plans, and to recommend any proposed amendments to the Board Pension Committee.
  • To bring to the attention of the CEO and the Board Pension Committee all relevant information with respect to the Committee’s activities.
  • To bring to the attention of the CEO and the Board Pension Committee an annual evaluation of the effectiveness of the Corporation’s pension policies and procedures.
  • To seek strategic guidance from senior management personnel of the Corporation, as required.
  • To perform such other functions and engage in other matters as may be determined by the CEO and the Board Pension Committee from time to time in furtherance of the foregoing.
  • To ensure that appropriate education and communication programs, including Plan governance-related information, are provided to all Members of the Plans, and to ensure that assessments of the effectiveness of such programs are carried out on a regular basis.
  • To recommend to the Board Pension Committee any material amendments to the Plan documents.
  • To review, at least annually, the Statement of Investment Policies and Goals for the defined benefit provisions of the Plans and/or the Statement of Investment Options and Information for the defined contributions provisions of Plan 1 and recommend any changes or amendments to the Board Pension Committee.
  • To periodically review assets under the Plans with respect to value, performance, and ownership and, with the advice of the Actuary, to determine the current liabilities of the defined benefit provisions of the Plans, in order to assist the Board Pension Committee in evaluating and setting funding policy for the Plans, and to report thereon to the Board Pension Committee.
  • To receive annually a report from the Actuary with respect to funded status and funding policy of the Plans.
    To co-ordinate the use of accounting assumptions within the ATCO Group for the recording of the Plans activities.
  • To periodically review the appropriateness of the Plans’ investment options and investment managers' performance against pre-determined performance evaluation criteria and to formulate such criteria.
  • To periodically review the allocation of funds subject to the defined benefit provisions of the Plans among the investment managers and any self-administered investments, and to make recommendations as to any proposed changes to the Board Pension Committee.
  • To make recommendations to the Board Pension Committee with respect to the appointment, termination or replacement of the Trustee(s), other custodians or funding agencies for the defined contribution provisions of Plan 1, the Actuary, investment managers, auditors, and performance measurement service, for the Plans, as applicable.
  • To recommend to the Board Pension Committee any economic increase to be made to pension payments.

The members of the Committee, for the purpose of performing their duties:

  • may delegate specific tasks to other individuals within the Corporation; and
  • have access to all the books and records of the Corporation and its wholly-owned subsidiary entities relating to the governance and administration of the Plans and to discuss such books and records in any manner with the officers and employees of the Corporation and its subsidiaries.

The Management Pension Committee Checklist attached to this mandate specifies certain tasks for which either the Committee as a whole or designated departmental representatives on the Committee have primary responsibility.