December 16, 2009
Poonam Puri argues against the so-called "30 per cent rule" that precludes pension plans such as ours from holding more than 30 per cent of the director voting shares in a company anywhere in the world – including Canada (It's Time To Abolish The 30-Per-Cent Rule – Dec. 16).
This burdensome rule limits the number of appropriate investment opportunities available to Teachers', and other similar Canadian pension plans, here and abroad, and saddles our investments with unnecessary costs. No other OECD country imposes such a limitation – which means foreign investors (including foreign pension plans) can invest in and acquire Canadian businesses, whereas Canadian pension plans are precluded.
We spend time and money competing for investments for which we're at a competitive disadvantage to foreign investors. This is time and money that would be better spent helping to grow and finance members' retirement incomes.
Millions of Canadians are disadvantaged by this rule: pension plan members as well as the taxpayers who match contributions to these plans.
Thought leaders and policy experts have long advocated for the elimination of this rule. They understand the benefits of making our funds as competitive and cost effective as possible. We need the country's finance ministers to share that understanding – and eliminate a disadvantageous, costly, outdated and redundant rule.
Director, Communications and Media Relations
Ontario Teachers' Pension Plan