PACIFIC PENSION INSTITUTE ANNUAL REPORT 2 011 PACIFIC CONTENTS PENSION Letter from Joseph A. Dear. Chair, Board of Directors 1-2 INSTITUTE & Marsha Vande-Berg, Chief Executive Officer Winter Roundtable, Laguna Beach 3-4 Manila Dialogue Program, Manila 5 Asian Network/Annual Dinner, Malaysia 6 Summer Roundtable, Vancouver 7-8 PPI Executive Seminar, Mumbai, New Delhi, Kuala Lumpur 9-10 Asian Pension Fund Roundtable, Kuala Lumpur 11-12 Membership Service, Communications and Outreach 13 Roundtables and Fiduciary Education 14 2011 Statement of Activities 15 Administration 16 Partnerships and Co-Sponsorships 16 Board of Directors and Advisory Council 17 Membership and Staff 18 Thank You 19 In Memory 20 2011 Winter Roundtable, Laguna Beach 2011 PPI Executive Seminar, Mumbai, New Delhi, Kuala Lumpur Pacific Pension Institute, a member-driven, nonprofit educational organization, assists pension funds, corporations, financial institutions and endowments worldwide with carrying out their fiduciary responsibilities, especially with respect to Asia and the Pacific region. 2011 Summer Roundtable, Vancouver 2011 Asian Pension Fund Roundtable, Kuala Lumpur Dear Members and Friends of PPI: programming. PPI grew our plan sponsor membership base to 31 pension plan, endowment and sovereign fund members, and our corporate membership to 42 banks, asset managers The year 2011 was yet another challenging year for institutional and law firms. Our programming included the 2011 Winter Roundtable in Southern investors. The debt crisis in Europe, persistent unemployment California, titled Environment for Investment, Risk, Reward or Distraction, and the Summer and a depressed housing market in the United States, together Roundtable, taking place in British Columbia, titled Asia’s Southern Rim: Perspectives from with a realization that emerging markets in Asia and elsewhere India, Southeast Asia and Oceana. are indeed dependent on the outlook in the West, combined to contribute in significant ways to ongoing market volatility. Still, Our annual Asian Pension Fund Roundtable took place in Kuala Lumpur, Malaysia, where asset managers for public and privately-held funds managed to the Institute shared the platform with our gracious in-country host, Malaysia’s Kumpulan register cautious optimism as they noted new, albeit modest, Wang Persaraan (Diperbadankan) (KWAP). Our appropriately timed theme was focused signals of improvement in the U.S. economy, even while watching on Investing When Change is Fundamental. Andrew Sheng, president, Fung Global Institute policymakers in European capitals struggle to find solutions to a in Hong Kong, headlined the plenary sessions. Six workshops and a Master Class on risk deepening fiscal crisis complicated by political constraints. It was and asset allocation formed the core experience for participants from 22 countries and clear to all that a Sino-centric Asia, while dependent on the West representing 35 funds. for import markets, was becoming increasingly influential in capital and financial markets and important as long-term investors to the PPI realized a milestone with the award of a grant by the Asian Development Bank global economy. underwriting a pilot Asia Dialogue at the Bank’s headquarters in Manila, the Philippines. The Dialogue engaged two dozen pension managers from emerging markets together with Midway through the year, the Board of Directors of the Pacific PPI’s plan sponsor membership for intense discussions around investment and operational Joseph A. Dear. Chair, Board of Directors Pension Institute decided on a strategic direction for the Institute, strategies. The program tapped PPI’s Asian Network of pension funds and affiliates and reflecting a wider recognition of Asia’s growing importance in contributed thematically to both the Asian Pension Fund Roundtable workshop discussions capital and financial markets. The intention of the Pacific Strategy and our annual publication of Pension Snapshots. We also produced a set of emerging is to render the Institute more Asia-facing and more deeply engaged market, pension fund benchmarks as part of the database project, funded by the grant from in Asia by virtue of our programming and communications, our the ADB, an honorary member of the Institute. The work aided PPI’s efforts to extend membership and our governance. Looking forward toward full our community of pension funds and affiliates and to encourage deeper understanding implementation in 2013, PPI’s professional staff will design our of markets and best practices. To accomplish this, we returned again to PPI’s hallmark two annual North American roundtables and will add an Asian emphasis on learning by dialogue between and among international peers. Roundtable that is patterned on the North American meetings but in an Asian venue. Programming also will include two smaller-scale In addition to Snapshots 2011: Pensions in Asia, a compendium of information on pension meetings in Asia, the Asia Dialogue for primarily Asian pension funds in 22 Asian economies, PPI also published two editions of Institutional Investor Briefs. managers, and the PPI Executive Seminar for the PPI membership. These were distributed to our membership along with roundtable program books and an array of electronic dispatches serving to connect PPI with our geographically As we embrace this new strategy, we will look both westward dispersed membership. In addition, our website, www.pacificpension.org, hosted timely and from North America and Europe and outward and globally from relevant information about our members, including edited video segments of the annual our vantage points in Beijing, Tokyo, Seoul, New Delhi, Singapore, Asian Pension Fund Roundtable. Hong Kong, Bangkok, Kuala Lumpur, Jakarta, Melbourne Marsha Vande-Berg, Chief Executive Officer and Sydney. We reached the end of this volatile year for markets with an ongoing sense of gratitude to our loyal membership. For this support, we continue to say thank you. The Membership and Program committees, chaired by Richelle Sugiyama and Barry Metzger, respectively, provided key Joseph A. Dear Marsha Vande-Berg support for our ongoing efforts to achieve controlled growth Chair, Board of Directors Chief Executive Officer in our membership and accomplish consistently high-caliber Pacific Pension Institute Pacific Pension Institute 1 2 Environment for Investment • Jeffrey Leonard, chief executive officer, Global • David Nelson, senior director of research and Environment Fund, and Min Tang, executive programs, Climate Policy Initiative, offered his Risk, Reward or Distraction? vice‐chairperson and president, YouChange New comprehensive views on the current environment for Philanthropy University, debated with facilitator investment and investment strategies. PPI convened the Winter Roundtable in Laguna Roy Doumani, Professor, University of California, 2011 Winter Roundtable Beach, California, around the theme of environmental • John Bryson, former chairman, chief executive Los Angeles, whether China and the United States officer and president of Edison International, investment. In attendance were institutional investors are in a footrace—or a marathon—in their pursuit February 23-25 discussed an array of clean energy technologies. He from 12 countries in North America, Asia and Europe. of support for green investments. Laguna Beach, California Collette Chilton, chief investment officer, Williams was introduced by D. Brooks Zug, senior managing College Investment Office, and Jack Wadsworth, advisory • In two breakout sessions, Arjun Thapan, special senior director, HarbourVest Partners. Mr. Bryson was advisor to the president for infrastructure and water, named the Obama administration’s Secretary of director, Morgan Stanley and PPI director served Asia Development Bank, and Ajit Dayal, founder, Commerce following the Roundtable. as co-chairs. Quantum Advisors Private Ltd., reviewed water • Returning as a speaker for a second time, Peter security and markets. In the second session, Guang Robertson, former vice chair, Chevron Corporation, Yang, chairman and chief executive officer, Finergy HIGHLIGHTS joined Mikkal E. Herberg, research director, Energy Capital; Eugene Yun, founder and managing partner, • Doug Cogan, director, Climate Risk Management, Security Program, The National Bureau of Asian EOS Investment Partners; and John Campbell, senior MSCI Inc. and author of Investor Guide to Climate Research, to explore energy economics, markets and partner and founder, Campbell Lutyens & Co., Risk and The Greenhouse Gambit: Business and security issues related to existing energy supplies. offered perspectives on the outlook for infrastructure Investment Responses to Climate Change and Russell Hiscock, president and chief executive officer, investment in Asia. Subsequently, Mr. Campbell Roger Sit, chairman, chief executive officer and CN Investment Division, chaired the session. president, Sit Investment Associates, shared views and Mr. Dayal reported on their respective breakout • Adam Segal, Ira A. Lipman senior fellow for on the challenges and opportunities for returns sessions to the full Roundtable audience. counterterrorism and national security studies, related to investing in a sustainable environment. • Ragui Assaad, professor, Humphrey Institute of the Council on Foreign Relations, engaged in Public Affairs, University of Minnesota, briefed • Rob Lake, head of Sustainability and Governance, conversation with William Owens, partner and chief participants by videoconference