2023 Funded Status Report
People. Purpose. Pensions.
Highlights for members
- 2023 Highlights
- Message from our CEO
- Pension Funding
- Serving Members
- Investment Strategy and Performance
- Responsible Investing
Protecting our pension promise in 2023 and beyond
2023 Highlights
Fully funded for 15 consecutive years
in net assets
10-year average net investment return (2014-2023)
nominal discount rate
one-year net investment return
Employee resource groups continue to grow and drive culture
A message from our CEO
Peter Lindley President and CEO
Fully funded in 2023
The past year was marked by volatile markets, geopolitical instability, and rising interest rates to tackle high inflation. Particularly in Canada, this led to increased consumer prices, surging mortgage costs and sluggish economic growth. Against this backdrop, OPTrust posted a one-year net investment return of 5.3 per cent. This brings OPTrust's 10-year net investment return to 7.2 per cent. We are long-term investors and the measure that matters is our funded status. OPTrust is fully funded for the 15th consecutive year, allowing us to deliver on our mission to pay pensions today and preserve pensions for tomorrow.
Supporting members
We take great pride in serving our members through all stages of their careers and during retirement. Our members tell us they appreciate the service we provide, consistently giving us a strong service rating.
Protecting our pension promise
OPTrust's climate change strategy is designed with one purpose in mind: to protect our pension promise over the long term. In December 2023, we released a one-year update to our enhanced climate change strategy, detailing the progress we have made since 2022 and the goals we have set to strengthen the fund's resiliency to climate change.
"Our five-year strategic plan aims to enhance the Plan's sustainability, invest in our people and strengthen our operational capabilities to create an OPTrust that is ready to meet the challenges of the future."
Peter Lindley
President and CEO
Pension funding
OPTrust’s mission is paying pensions today, preserving pensions for tomorrow.
The Plan’s sponsors (the Government of Ontario and OPSEU) set contribution and future benefit levels based on the Plan’s funded status. OPTrust is fully funded for the 15th year in a row.
Your pension is based on your earnings and years of service.
We seek to maintain a balance between:
Benefit security,
Contribution rate stability,
Fairness between the two schedules of benefits, and
Intergenerational equity, which means every generation of members will pay a fair amount for the benefits they receive.
Serving members
We take great pride in engaging our members during all stages of their careers. Whether they are starting out, mid-career or approaching retirement, members are confident that our team will guide them as they assess their pension options and make important decisions.
2023 Highlights
members in the OPSEU Pension Plan
life events supported in 2023 — we support our members as life changes
CEM Benchmarking Inc. global ranking
member service rating
in entitlements paid
new employers in OPTrust Select, growing membership to over 4,200
“While it's uncommon for charities to provide pensions, we were excited to offer our staff a pension through OPTrust Select. We know our team appreciates this valuable benefit because it helps them plan for the future.”
Lori Nikkel
CEO, Second Harvest
“OPTrust has been fantastic in providing guidance and reassurance throughout my journey towards retirement. Taking the leap into retirement is a big deal, and I'm grateful that everything was taken care of and for the support.”
Jerry Arnold
Senior Staff Development Officer (retired December 2023), Correctional Centre for Professional Advancement and Training
"The people at OPTrust are engaged in purposeful work. A sustainable pension, fully funded for 15 consecutive years, is representative of OPTrust delivering pensions and peace of mind for our members."
Peter Lindley
President and CEO
“As a member, I appreciate the benefit of accessing my account online. I'm able to easily view my annual pension statements and check what my monthly retirement income will be once I retire.”
Suri Bal
Public Affairs and Event Coordinator; Ministry of Agriculture, Food and Rural Affairs
“The pension for me and my staff represents financial security. The guarantee of having a modest income in retirement, provides us with peace of mind. It allows us to focus on the present without worrying about the future.”
Zeeshan Liaqat
Chief Financial and Operating Officer, Second Harvest
Investment strategy and performance
Investment returns account for more than 70 per cent of the benefits we pay to members when they retire. To achieve this, we manage a globally diversified portfolio of assets and seek the best opportunities for value creation. Balancing return expectations against funding risks ensures we have sufficient assets to pay pensions now and in the future.
Total Portfolio performance
The Total Portfolio return is net of management fees, transaction costs and investment administration expenses.
Our Member-Driven Investing philosophy
We invest Plan assets to help deliver pension security for our members.
Our Member-Driven Investing (MDI) strategy is the application of a Total Portfolio approach, in which we strive to deliver the total return, after all costs, needed to keep the Plan sustainable without taking excessive risk.
We strive to construct our portfolio to be resilient to different economic and market environments to the extent possible, helping us deliver attractive risk-adjusted returns over the long term.
Investing at home and internationally
We have access to a broad set of investment opportunities. About 17.4 per cent of our investments are in Ontario while about 34.5 per cent are in Canada. Our international footprint covers the U.S., Europe, Asia Pacific and Latin America. This global approach offers diversification and return-enhancement benefits to the Total Portfolio and is an important part of our investment program.
Ontario: 17.4%
Canada: 34.5%*
U.S.: 46.0%
Europe: 10.9%
Asia Pacific: 7.7%
Latin America: 0.9%
Based on country of risk, location of primary income or location of property. Gold, commodity and funding portfolios are excluded from exposures. * Includes Ontario.
Responsible Investing
OPTrust's Responsible Investing (RI) program is an integral component of our investment strategy, contributing to sustainable pension security for our members.
We recognize that environmental, social and governance (ESG) factors can materially affect investment risk, return and our reputation.
Every investment professional at OPTrust is responsible for including ESG risks and opportunities in their decision making and prioritizing stewardship in their asset management activities.
This approach supports the Plan in navigating an increasingly complex investment environment and is grounded in our fiduciary duty to our members.
2023 Highlights
Released an update on our climate strategy with metrics and targets to track and drive progress towards a more climate-resilient portfolio, as well as a climate metrics toolkit to share our learnings from this process with other investors.
Voted at 880 company meetings in 29 countries.
Engaged 113 companies on key ESG issues.
Completed our first full-scale data collection cycle for COMPAS (Capturing OPTrust Management and Progress Around Sustainability), our internally developed ESG data program.
Completed our Responsible Investing Partner Evaluation framework on 100 per cent of new externally managed investments and engaged with prioritized partners.
Continued to be an active voice in investor collaborative initiatives, including UNPRI’s Private Equity Advisory Committee, Thinking Ahead Institute’s climate change working group, and Ceres’ private equity working group.
See the big picture
For more information on all our results, read our 2023 Funded Status Report.
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