Morning Devil’s Advocates
Fraser Smart, Chief Executive Officer, BA Pensions
Bridget Uku, Group Manager – Treasury & Investments, London Borough of Ealing
Fiona Brown, Head of Group Pensions – Europe, Thomas Cook Group
08:45 – 08:55
Welcome & Opening Remarks
08:55 – 09:20
Keynote Presentation: The Outlook for DB Funds
Ronan O’Connor, Deputy Director, Private Pensions Policy,
Department for Work and Pensions
Our speaker will examine the state of the UK DB fund sector from a policy perspective. He will cover, among other topics, the new DB funding code, the health of the sector, the significance of headline figures on pension deficits, the degree of latitude that plans have to determine their funding levels, new TPR powers to enforce pensions regulation, how to interpret key elements of the rules, and the main challenges facing both official bodies and the industry.
09:20 – 10:00
Panel: How Funding Shortfalls Map onto Investment Strategy
Tony Filbin, Chairman, Capital Cranfield Trustees
Mark Chadwick, Head of Pensions, RBS Group Pension Scheme
Karin Franceries, Head of Institutional Advisory, Amundi Asset Management
Elaine Torry, Senior Investment Consultant, Hymans Robertson
- The biggest challenge in DB pensions is not finding the right investments, it’s creating the conditions in which the best investment decisions can be made.
- Deficits measured by gilt yields place huge pressure on plans to use leverage to buy expensive government bonds.
- Are trustees being pushed into bonds when a diversified portfolio of return-seeking assets held over the long term is almost certain to outperform bonds?
- Do members want a 100% chance of getting 90% of their benefits, or a 90% chance of getting 100% of their benefits?
- And does “de-risking” really reduce risk?
10:00 – 10:20
Presentation: The Economic State of the World
Arif Husain, Head of International Fixed Income, T. Rowe Price
- The ongoing Brexit saga.
- The Trump Factor – all change on geopolitics and trade policy.
- Interest rates inching up – some relief for DB funds?
- The return of inflation and its portfolio consequences.
- Are we near the end of the cycle: where are the risk-off and risk-on plays?
- The investment strategies and products that will help DB plans thrive under the new economic conditions?
10:20 – 10:50
10:50 – 11:30
Panel: The Great Win-Win – Assuming More Risk and Doing More With It
Caroline Escott, Investment and DB Policy Lead, Pensions and Lifetime Savings Association
David Schofield, President, International Division, INTECH Investment Management
Ian Mason, Portfolio Manager, AEW Investment Management
- As discussed on the earlier panel, funding methodologies have the effect of weighting investment strategies towards conservatism.
- However, it’s an axiom of investing that you cannot achieve higher return without assuming more risk.
- How often will consultants and actuaries advise plans to do so?
- If plans assume more risk, based upon more realistic forecasts of expected return, what would the resulting asset mix look like?
- Specifically, what are the risk-seeking investments that make most sense for DB plans, and in what combination?
11:30 – 11:50
Presentation: Craftsmanship Alpha – Creating Value for DB Funds in a De-Risking Environment
Thomas Kieselstein, Chief Investment Officer, Quoniam Asset Management
At a time when DB schemes are derisking and simultaneously seeking extra return, our speaker will explore how value can be systematically added through ‘craftmanship alpha’ or skilful implementation, including more advanced factors and multi-dimensional optimisation, in equity portfolios. He will examine how advanced factors, alternative data sets and even artificial intelligence can be used to add value without adding risk.
11:50 – 12:10
Presentation: The Future of Fixed Income – How Innovative Technology Can Yield Better Returns
Jeff Skoglund, Chief Operating Officer – Fixed Income, Alliance Bernstein
- Fixed income markets are evolving and creating challenges for investors. The market has rapidly expanded, yet inventories and liquidity have shrunk markedly since the financial crisis.
- Clients need to ask their investment managers if they can meet three key challenges that could have significant impact, particularly in times of heightened stress; liquidity, scarce alpha and regulation.
- Empowering portfolio management teams by integrating sophisticated technology into robust fundamental and quantitative fixed income processes will be key to solving this.
12:10 – 12:50
Panel: Social Impact Investing
Sally Bridgeland, Chair of the Investments Board, Local Pensions Partnership
Mark Walker, Chief Investment Officer, Coal Pension Trustees
Mark Thompson, Chief Investment Officer, HSBC Bank Pension Trust
12:50 – 14:00
Afternoon Devil’s Advocates
Pam Taylor, Group Pension Manager UK & Ireland, BASF
Kevin O’Boyle, Head of Pensions, BT
Mark Thompson, Chief Investment Officer, HSBC Bank Pension Trust
14:00 – 14:20
Presentation: Multi-Factor Investing
Bill DeRoche, Chief Investment Officer, FFCM
14:20 – 15:00
Panel: What’s the Endgame – Self-Sufficiency, the PPF, Buy-Out, or a Super Fund?
Edi Truell, Executive Chairman, Disruptive Capital
David Taylor, Executive Director & General Counsel, Pension Protection Fund
Jay Shah, Head of Origination, Pension Insurance Corporation
- Removing the entire pension liability from the books is very tempting for sponsors.
- But it can be very expensive.
- Do insurance solutions offer the best outcome for members?
- If a plan does choose the de-risking route, do Super Funds offer a better option?
- Would not a more innovative and return-seeking investment strategy be preferable?
- Is the PPF too cautious?
- Can insurance and superfund solutions address the inefficiencies of smaller DB plans as well, and the issues faced by weak employers with underfunded schemes?
15:00 – 15:20
Presentation: Opportunities in Shorter Dated Credit
Chris Bowie, Partner, TwentyFour Asset Management
15:20 – 15:55
15:55 – 16:25
16:25 – 16:45
Presentation: Innovative Investment Strategies
TBC, BNY Mellon
At the end of 2017, Chancellor Philip Hammond announced the launch of an action plan to unlock over £20bn of new investment in scale-up projects, including support for pension funds to provide long-term investment as part of this innovation push. The government also committed to publish a new long-term strategy to ensure that the UK asset management industry continues to thrive and deliver the best possible outcomes for investors and the UK economy. This includes steps to improve skills, harness financial technology solutions, bring innovative investment strategies into the mainstream and continuing a coordinated programme of international engagement. Our speaker will discuss the opportunities this initiative presents for DB plans and how asset managers are responding.
16:45 – 17:25
Panel: Consequences of CETV Transfers for the Investment Portfolio
Henry Tapper, Founder & Editor, Pensions PlayPen
Fraser Smart Chief Executive Officer, British Airways Pensions
Odi Lahav Chief Executive Officer, MJ Hudson Allenbridge
David Fairs Executive Director for Regulatory Policy, Analysis and Advice,
The Pensions Regulator
- There has been an enormous volume of transfers from DB funds to DC and other vehicles.
- This throws the spotlight on the question of what members really want in retirement, and means that DB trustees much engage and communicate with their members as never before.
- How does TPR see its statutory objective to protect members in light of the almost £40 billion transferred out of DB schemes last year
- From an investment standpoint there are two principal implications of transfers:
- The use of liquidity management strategies to manage transfers efficiently
- The development of an optimal allocation for the resulting portfolio with its revised liability structure
- Pension executives and advisers will discuss how they are working together to manage the effect of CETV transfers
17:25 – 17:30
17:30 – 19:00
19.00 – 22:00