How Pension Plan Assets are Invested
Ontario pension legislation requires pension plan administrators to establish a Statement of Investment Policies and Procedures (SIPP) to guide the investment of the pension plan’s assets.
One important investment policy for a defined benefit plan is the plan’s asset mix, which sets out the proportion of how much of each type of asset the plan should hold.
The most common types of assets held by a defined benefit plan, or investment options used in a defined contribution plan, include:
- fixed income investments (for example, treasury bills, government bonds, or corporate bonds);
- public equities (company stocks); and
- cash investments (for example, Guaranteed Investment Certificates, money market funds).
The number and type of investment options in which plan members may invest their pension assets are important policy parameters for a defined contribution plan.
Getting information about your plan’s investment policies and procedures
If you are a plan member, former member or retired member of a defined benefit pension plan, you can get a copy of your plan’s Statement of Investment Policies and Procedures (SIPP) from your pension plan administrator or from FSCO. You can compare your plan’s asset mix, found in the SIPP, to the industry average in Ontario through FSCO’s Report on the Funding of Defined Benefit Pension Plans in Ontario.
If you are a member of a defined contribution pension plan, you can get a copy of your planís SIPP from your pension plan administrator or from FSCO. The information on your planís investment policies and procedures and the 2017 Report - Ontario Pension Plan Filings of Statement of Investment Policies and Procedures Information Summaries can help you compare your planís investment fund offerings to industry practices.