The concept of pension plan governance is commonly defined by pension authorities as the structures and processes for overseeing, managing and administering a pension plan to ensure all obligations of the plan are met.

At CMHC, the pension governance structure and related practices evolve over time as opportunities are taken to enhance the governance of CMHC's Registered Pension Plan and its Fund. The Pension Plan Governance Guidelines, issued in 2004 by the Canadian Association of Pension Supervisory Authorities (CAPSA, of which OSFI is a member), serve as a key reference for pension governance at CMHC. A formal review of CMHC's governance practices is conducted on a regular basis.

The following describes CMHC's governance objectives and practices, the governance structure, and the roles of the participants in the governance structure, as they relate to CMHC's Registered Pension Plan and its Fund.


Good corporate governance is at the heart of all of CMHC's activities and successes and is echoed in the governance framework for the Pension Plan and its Fund. A sound framework ensures that the ongoing obligations of the Pension Plan to its stakeholders can be met, with effective decision-making processes, prudent and efficient management of resources, and regular communication. CMHC's practices in support of these objectives are discussed in the following four broad sections on roles and responsibilities, performance measurement, communications and information, and code of conduct and risk management.

Roles and Responsibilities

Roles and responsibilities are an important element of any governance framework.  At CMHC, key roles and responsibilities for the governance, management, and operation of the Pension Plan and its Fund are approved by the Board of Directors and reviewed and refined over the years to reflect best practices.

Performance Measurement

Processes are in place to monitor and evaluate the investment performance of the Pension Fund (including performance measures for the overall Fund and individual asset classes), and the performance of decision-makers in the governance process.  As well, management of pension fund liability risk is a consideration in CMHC's Enterprise Risk Management policies.  Mechanisms are also in place to oversee and ensure compliance with legislative requirements and policies.

Communications and Information

CMHC has numerous practices in place to ensure that those involved in the governance of the Pension Plan and Pension Fund have access to relevant, timely, and accurate information.  Amongst other matters, the Board of Directors receives reports from the Chair of Trustees following Trustees' meetings (including a formal report each year on the Pension Fund's performance and Trustees' activities), minutes of Trustees' meetings and the Pension Plan Annual Report.  Reports on plan benefits and administration and compliance matters are submitted regularly to the governing bodies, as appropriate.  Trustee and Investment Committee meetings are held regularly and have comprehensive agendas, and orientation sessions are provided to new members.  CMHC communicates with plan members and Pension Council as appropriate, and holds orientation sessions for Pension Council members.  As well, the Pension Plan Annual Report explains the governance process and provides contact information.

Code of Conduct and Risk Management

CMHC has a well-documented and comprehensive Code of Conduct that is comprised of a Code of Values and Ethical Conduct and a Conflict of Interest Policy. The Trustees have also adopted CMHC's Code of Conduct.  Accordingly, the Trustees, the Investment Committee, the Investments and Pension Fund staff, and any person involved in the administration of the Fund are required to sign and adhere to CMHC's Code of Conduct.  In keeping with best practices for risk management, CMHC's Board of Directors has established Enterprise Risk Management policies that include policies specific to the Pension Fund.  Internal control frameworks are in place for the Pension Plan and Pension Fund and they are frequently reviewed. Internal controls are further strengthened with additional monitoring and reporting on compliance matters by CMHC's Compliance Office.


CMHC's pension governance structure comprises six bodies: the Board of Directors, the Pension Fund Trustees, the Pension Fund Investment Committee, the Investments and Pension Fund division, CMHC's Management Committee, and the Human Resources Sector (Pension and Benefits group).

CMHC's Board of Directors, which established the Pension Fund, is responsible for approving the Pension Fund's mission, investment philosophy and Enterprise Risk Management policies applicable to the Pension Fund, including the asset allocation policy.  The Board reviews the Pension Fund's performance on an annual basis. It also reviews and approves actuarial valuation reports for filing with regulatory authorities, the level of CMHC's contribution to the Fund pursuant to the Pension Plan Rules, any amendments to the Pension Plan Rules, and the Pension Plan Annual Report. It is supported by a Human Resources Committee of the Board, which it created to oversee corporate human resources policies and strategies. The Board has delegated general management and administrative responsibilities for the Fund to the Trustees.

The Pension Fund Trustees set investment policies and objectives within the context of the Enterprise Risk Management policies established by the Board, and periodically review the asset allocation policy. If changes in the asset allocation policy are considered to be required, the Trustees make the appropriate recommendation to the Board of Directors. In addition, the Trustees establish performance standards for measuring progress toward objectives and approve the appointment of external investment managers.

The Pension Fund Investment Committee assists the Trustees in the investment management of the Pension Fund. The Committee meets at least six times per year to review the Pension Fund's performance, current economic scenarios, projections and their implications for the investment portfolio.  It recommends investment policies and strategies to the Trustees and helps monitor the effectiveness of their implementation. The Committee's membership includes two external independent investment experts.

CMHC's Investments and Pension Fund Division develops and recommends specific investment policies and strategies to the Pension Fund Investment Committee, Trustees, or Board of Directors, as appropriate. Investment managers direct the ongoing operations of the Pension Fund's various asset classes. These operations include the purchase and sale of investments and assessment of external investment managers, all in accordance with approved policies.

The Pension Fund Administration Group, within Investments and Pension Fund, carries out the cash management, accounting, financial reporting, investment performance measurement and compliance functions, together with the coordination of auditing and actuarial activities needed to support the Fund's operations and meet legislative requirements.

The President and Chief Executive Officer of CMHC recommends for Board approval, generally with the advice of Management Committee, changes to pension benefits or the design of the Pension Plan and related changes to the Pension Plan Rules, the results of actuarial valuations, and the levels of corporate and employee contributions to the Pension Fund. The President also recommends changes to the governance structure to the Board for approval, with the advice of Management Committee, as appropriate.

The Human Resources Sector of CMHC administers Pension Plan benefits in accordance with the Pension Plan Rules and recommends pension benefit changes and related rule changes to CMHC's Management Committee. It also disseminates information relating to the Pension Plan to plan members, and maintains member records.

Other Pension-related Roles and Responsibilities

Two other bodies, the Pension Plan Coordination Committee and the Pension Council, play important supportive roles for CMHC's pension governance structure.

The Pension Plan Coordination Committee provides a forum for discussion and collaboration amongst Pension Fund, Human Resources and Legal Services staff on pension matters of common interest, such as the Pension Plan Annual Report, communications with plan members, and pension governance.

The Pension Council consists of elected employee and retired members of the Pension Plan. Its functions are to promote awareness and understanding of the Plan amongst members and to review financial, actuarial and administrative aspects of the Plan annually. Three of its members, two employees and one pensioner, are elected by the Council to serve as Trustees. As well, another member is appointed by the President to the Pension Fund Investment Committee.

Additionally, advisory and other supporting roles are played by numerous individuals within CMHC.


The key roles and responsibilities related to the governance structure for the Pension Plan and its Fund have been consolidated for reference purposes in the summary of Key Roles and Responsibilities for Pension Governance for CMHC's Registered Pension Plan. In the event of any inconsistency with the Trust Agreement or other governance documents approved by the Board of Directors or the Pension Fund Trustees, those documents prevail over the summarized Key Roles and Responsibilities.