WEBVTT 00:03.003 --> 00:05.672 The Teachers Pension Fund was created in 1917. 00:05.672 --> 00:11.970 You get to the 80s and there's a task force looking at pension funds in Ontario. 00:11.970 --> 00:14.806 And one of the recommendations was the creation 00:14.806 --> 00:18.727 of an independent organization to run the Ontario pension fund. 00:18.727 --> 00:22.897 The first person that the government approached was Gerry Bouey, 00:22.897 --> 00:25.191 former Governor of the Bank of Canada. 00:25.525 --> 00:27.193 And he set the ground rules. 00:27.193 --> 00:30.113 It's because of him that Teachers is successful. 00:30.196 --> 00:33.867 Because he said it was going to be set up with a board of directors 00:33.867 --> 00:36.870 chosen by but independent of the teachers and the government. 00:36.870 --> 00:38.747 There would be a CEO. 00:38.747 --> 00:41.499 A lot of the success at Ontario Teachers 00:41.499 --> 00:43.209 is because we had a good board. 00:43.209 --> 00:46.087 Gerry brought people that understood investment. 00:46.087 --> 00:49.424 There was not a pension plan in the world that was set up that way. 00:49.466 --> 00:51.009 They were all trusts. 00:51.009 --> 00:54.220 We inherited 16 billion 00:54.220 --> 01:00.018 of non-marketable, non-assignable, non-negotiable Ontario government debentures. 01:00.018 --> 01:04.022 So when Bob Bertram was hired in the fall of 1990, 01:04.022 --> 01:05.899 really my first hire and he was 01:05.899 --> 01:07.150 a fabulous hire. 01:07.192 --> 01:12.989 I had a way to instantly, or almost instantly diversify the portfolio into equity. 01:12.989 --> 01:15.200 And that was using derivatives and swaps. 01:15.200 --> 01:19.204 Where you swap the return of an Ontario government bond 01:19.204 --> 01:22.832 with a bank that gives you the return of the S&P 500. 01:22.832 --> 01:26.836 A very pleasant surprise that we could not just diversify the Canadian equity, 01:26.836 --> 01:28.379 but any place we wanted to go. 01:28.421 --> 01:32.801 So we were instrumental in allowing pension funds in Canada 01:32.801 --> 01:34.761 to be able to invest outside the country. 01:34.928 --> 01:38.056 What we found in the 1980s and into the early nineties, 01:38.056 --> 01:40.642 as you got more powerful personal computers, 01:40.642 --> 01:42.310 you could actually put the data in 01:42.310 --> 01:44.771 so that you could make decisions in a timely fashion. 01:44.813 --> 01:48.191 That drove us to doing all of the diversification we did. 01:48.191 --> 01:50.485 We started co-investing. 01:50.485 --> 01:54.197 The most unique one was Maple Leaf Sports and Entertainment. 01:54.197 --> 01:56.449 That put us on the map 01:56.449 --> 01:59.035 as an independent thinker in the investment world. 01:59.118 --> 02:00.370 Cadillac Fairview. 02:00.370 --> 02:03.039 This was a fantastic acquisition. 02:03.498 --> 02:05.041 This was the first time that 02:05.041 --> 02:07.836 a pension fund in Canada had owned an operating company. 02:07.836 --> 02:11.548 Initially, at least what I wanted was to manage 80% in house. 02:11.548 --> 02:14.717 If we can get the same quality of internal management 02:14.717 --> 02:16.803 that we get from external, we could save a lot of money. 02:16.845 --> 02:17.971 When I came along, 02:17.971 --> 02:21.432 the ideas was that the plan should invest in private assets, 02:21.432 --> 02:23.768 that there was an advantage to that. 02:23.810 --> 02:24.894 So here you are 02:24.894 --> 02:26.145 buying an asset 02:26.145 --> 02:28.231 at a lower price than if it was public. 02:28.231 --> 02:30.191 You've got better transparency. 02:30.233 --> 02:31.818 And you can hold it for the long term. 02:31.818 --> 02:33.319 It sounds very obvious. 02:33.319 --> 02:34.988 But Bob Bertram and Claude Lamoureux 02:34.988 --> 02:37.031 were the first to really understand it. 02:37.031 --> 02:40.952 Teachers just kept coming out with a series of firsts. 02:40.952 --> 02:42.954 It was the first in private equity, 02:42.954 --> 02:46.207 then it rolled into infrastructure, then it rolled into hedge funds. 02:46.207 --> 02:47.750 It just kept going and going. 02:49.502 --> 02:51.337 The great financial crisis. 02:51.337 --> 02:52.297 It was very difficult. 02:52.297 --> 02:54.007 I went out and stood on the desk 02:54.007 --> 02:56.259 and had them all gathered around and talked about 02:56.259 --> 03:01.014 you know, this is the time you actually really need to have conviction. 03:01.097 --> 03:04.100 For Teachers, it was a growing up moment. 03:04.100 --> 03:05.643 We didn't curl up in a ball. 03:05.643 --> 03:08.438 Everybody got together, figured out what had to happen, 03:08.438 --> 03:11.024 and literally sent people on planes at that afternoon 03:11.024 --> 03:13.401 to deliver letters to the various counterparts 03:13.401 --> 03:14.944 to make sure we were first in line 03:14.944 --> 03:17.030 to get money back from the banks. 03:17.071 --> 03:19.574 And we just sent them off and said, "Deliver this!" 03:19.574 --> 03:21.284 and "Don't take no for an answer!" 03:21.534 --> 03:22.201 And they did it 03:23.369 --> 03:27.206 The next five, ten years after the global financial crisis 03:27.206 --> 03:29.667 was really a time of building out our talent, 03:29.667 --> 03:31.711 building out our international aspirations 03:31.753 --> 03:35.215 but also making sure they're embedded in good systems and controls 03:35.215 --> 03:38.217 for an organization which had frankly at that stage grown massively 03:38.217 --> 03:39.469 from where it started. 03:39.928 --> 03:41.638 In January 2020, 03:41.638 --> 03:43.306 COVID had arrived. 03:43.306 --> 03:44.724 And where I was very lucky was, 03:44.724 --> 03:45.850 I had a great team around me, 03:45.850 --> 03:47.185 great support from the board. 03:47.268 --> 03:51.940 We've been through many stresses in markets. 03:51.940 --> 03:54.984 watching markets overnight, trying to anticipate what's going to happen. 03:55.151 --> 03:58.738 So we do spend a lot of time thinking about portfolio construction 03:58.738 --> 04:01.783 and making sure that we're not going to be unduly affected 04:01.783 --> 04:04.160 by some of these big, major shocks, 04:04.160 --> 04:06.579 which are supposed to happen once every hundred years, 04:06.579 --> 04:08.414 but they seem to happen once every five years. 04:08.414 --> 04:09.165 You know what? 04:09.165 --> 04:11.251 The sun still rises and still sets, 04:11.251 --> 04:14.671 even if the financial markets aren't functioning as we all expected. 04:14.796 --> 04:17.715 I think every crisis that we've weathered you learn something, right? 04:17.715 --> 04:20.426 And that's, I think, the message we want to get across to teachers, 04:20.426 --> 04:23.638 is we're building as secure a portfolio as we can for you, 04:23.638 --> 04:25.515 so that you don't have to worry about 04:25.515 --> 04:27.934 where your pension payments are going to be coming from. 04:30.061 --> 04:31.980 There were a lot of things that I was proud of. 04:31.980 --> 04:35.483 One was moving us from Young and Finch to downtown. 04:35.483 --> 04:37.986 I executed on some of the beginning of it. 04:38.361 --> 04:41.239 And Joe, God bless him, took it to its final execution. 04:41.364 --> 04:44.617 It definitely is conducive to a new style of working. 04:44.826 --> 04:47.870 I would say that everybody who works at Ontario Teachers 04:47.870 --> 04:49.831 really cares about the members. 04:49.872 --> 04:54.669 There is such a culture of service excellence within this organization. 04:54.669 --> 04:57.088 It's so a part of our DNA. 04:57.088 --> 04:59.799 In 2001, we built our first website. 04:59.799 --> 05:03.177 Way before a lot of service organizations were even thinking about that. 05:03.177 --> 05:06.639 Today, 90% of all of our transactions 05:07.098 --> 05:09.726 are self-serve with our digital assets. 05:09.726 --> 05:11.227 I'm really, really proud 05:11.269 --> 05:13.938 of the satisfaction scores. 05:13.938 --> 05:15.940 We look in a lot of different ways to understand 05:15.940 --> 05:17.483 how our members are feeling. 05:17.483 --> 05:20.695 Teachers has a bit of a culture where we're always striving to be better. 05:20.862 --> 05:23.406 We look at what we do and then take it apart and say, 05:23.406 --> 05:24.699 what could we do differently? 05:24.741 --> 05:26.451 This is a different environment, 05:26.451 --> 05:28.369 that doesn't necessarily mean you can't perform in it. 05:28.369 --> 05:30.329 Those folks back in 1990, 05:30.496 --> 05:33.458 when they were thinking about a totally novel governance model, 05:33.458 --> 05:35.626 a totally novel set of solutions, 05:35.626 --> 05:38.504 they were looking at their environment and making certain assessments, 05:38.504 --> 05:41.549 and I think over the last few years, we've been doing exactly the same thing. 05:41.591 --> 05:43.718 I think the thing that will really make sure we are successful 05:43.718 --> 05:45.511 is that we continue to work together 05:45.595 --> 05:47.096 with a positive culture 05:47.096 --> 05:48.598 and a desire to learn. 05:48.598 --> 05:51.100 And that's been a feature of Teachers over the last 35 years, 05:51.100 --> 05:53.436 and I think it sets us in great stead for the future.