Report: Business Board - October 06, 2020

Via Virtual Meeting


October 6, 2020

To the Governing Council,
University of Toronto.

Your Board reports that it held a virtual meeting on Tuesday, October 6, 2020 at 5:00 p.m. with the following members:

Anna Kennedy (Chair); Bruce Winter (Vice-Chair); Scott Mabury, Vice-President, Operations and Real Estate Partnerships; Kelly Hannah-Moffat, Vice-President, Human Resources and Equity; Sheila Brown, Chief Financial Officer; Robert G. Boeckner; Harvey Botting; David Bowden; Teodora Dechev; K. Sonu Gaind; Sue Graham-Nutter; Sarosh Jamal; Kathryn A. Jenkins; Joan Johnston; Amin Kamaleddin; Kikelomo Lawal; Jan K. Mahrt-Smith; Brian A. Miron; Andrew Padmos; David Regan; Susan Rodgers; Danielle Skipp; Ian Taylor; Vishar Yaghoubian;

Regrets: None

Anwar Kazimi, Deputy-Secretary of the Governing Council; Patrick F. McNeill, Secretary

Non-Voting Assessors:
Cheryl Regehr, Provost and Vice-President; David M. Estok, Vice-President, Communications; David Palmer, Vice-President, Advancement; Joseph Wong, Interim Vice-President, International; Heather Boon, Vice- Provost, Faculty and Academic Life; Joshua Mitchell, Director, Real Estate; Trevor Rodgers, Assistant Vice-President, Planning and Budget; Ron Saporta, Chief Operations Officer, Property Services and Sustainability

In Attendance:
Tad Brown, Counsel, Business Affairs and Advancement; Elizabeth Cragg, Director, Office of the Vice-President, Operations and Real Estate Partnerships; Sherol Cowell, Manager, Office of Vice-President, Advancement (VPA); Chantelle Courtney, Assistant Vice-President, Divisional Relations, VPA; Barbara Dick, Assistant Vice-President Alumni Relations; Rosalyn Figov, Chief Operations Officer, Office of the Vice-President Human Resources and Equity; Tony Gray, Director, Strategic Research, Office of the President; Jane Harrison Director, Office of the Vice-Provost Faculty and Academic Life; Tonya Kreinin, Assistant Vice President, Brand Strategy and Integrated Marketing; Mila Miller, Executive Director, Strategic Planning and Advancement Organizational Development; Gillian Morrison, Assistant Vice President, University Development; Pierre Gilles Piché, Controller and Director of Financial Services; James Robertson, Chief Operating Officer, VPA; Tracey Rutledge, Executive Director, Alumni Relations and Development
Mark Sedore, Senior Communications Advisor, VPC; Daren Smith, President and Chief Investment Officer, University of Toronto Asset Management Corporation (UTAM)


Pursuant to section 33(i) of By-Law Number 2,
items 19 to 22 were considered in camera.


  1. Chair’s Remarks

    The Chair welcomed new and returning members and guests to the meeting.
  2. COVID-19
    1. COVID-19 Update

      Professor Scott Mabury, Vice-President, Operations and Real Estate Partnerships, and Mr. Ron Saporta, Chief Operations Officer, Property Services and Sustainability provided an oral update on COVID-19 and its impact on financial-related and operational matters.

      -Highlights presented included the following:

      -despite the significant uncertainty created by the COVID-19 pandemic, early indications were that overall enrolment levels for the fall term were roughly in line with last year, with some differences at the level of individual divisions and programs;

      -domestic undergraduate student enrolment was approximately 9% below target, while international undergraduate enrolment was approximately 7% higher than target;

      -although it was still early in the year, it was hoped that this result would hold throughout the fall and into the winter term. As a result, there would be no significant reduction to budgeted operating revenue;

      -the University had seen significant cost increases in many areas, including repatriation of students who were overseas during the initial lockdown, emergency financial support for students, transition to online course delivery, and costs to support the safe re-opening of research labs and workplaces;

      -at the same time, there were savings in planned travel costs, lower utilities and supplies usage due reduced on-campus activity;

      -Ancillary services such as residences, food, and parking were impacted by a significant loss of revenue due to reduction in on-campus activity. Ancillary operations were forecasting a loss of $64 million across all three campuses, despite significant cost-saving strategies over the previous six months. Losses were expected to deplete operating and capital reserves in ancillary units, and divert some planned maintenance spending;

      -Re-opening Plan had been implemented across the three campuses; based on three principles: promoting health and safety, advancing academic excellence and meeting the needs of the University community;

      -Action plans based on general workplace guidelines which were reviewed regularly as provincial health updates released;

      -assessments were conducted in each department to assess what activity/action was necessary on campus and what controls should be put in place – these included the mandatory mask policy, enhanced caretaking measures, and the implementation of a ventilation and enhanced filtration strategy;

      -other actions included the introduction of a screening app for use by students and staff, implementing maximum occupancy limits, and the development of response protocols if a COVID event occurred on campus; and

      -the University recognized the need to ensure supports were in place, like work from home guidelines, leadership tool kits, study spaces for students to ensure access to internet and other supports.

      Professor Kelly Hannah-Moffat, Vice-President, Human Resources and Equity (HRE), provided an update on human resource initiatives as it related to COVID-19.

      She highlighted the following with respect to resources and support for those staff members returning to work on campus and those who continued to work at home:

      -HRE had worked closely with health and safety to advise divisions and CAOs on all elements of re-entry plans;

      -HRE provided ongoing COVID support and accommodation with staff that were immune compromised and those with childcare and elder care needs;

      -although some reductions in staff, HRE was supporting employees by creating a supplemental unemployment benefit for those on temporary layoff; would continue benefit as staff transferred from the Canada Emergency Response Benefit (CERB) to Employment Insurance;

      -other accommodations were in place for employees such as flex hours and work from home provisions;

      -HRE provided managers and supervisors with additional training programs and had released wellness resources to staff and community members;

      -the employee and family assistance program (EFAP) was extended to casual employees,;

      -HRE implemented remote onboarding as managers hired remotely;

      _a flexible work arrangement guideline was to launch in the fall as the University transitioned away from COVID-related work from home arrangements to long term work from home arrangements, if appropriate; and

      -childcare centers reopened.

      In response to a member’s question regarding in-person classroom attendance, Professor Cheryl Regehr, Provost and Vice-President, stated that 10% of students elected to attend at least one in-person class – the majority because of the nature of the program; the other 90% attended via online courses. With regard to international students arriving on campus, the Provost noted that a robust quarantine program had been implemented (966 students registered for the quarantine program of which 859 had completed it); the University also provided support for transportation, accommodation, meals and daily checks. Professor Regehr added that the University had received positive feedback from students, parents and the government on how robustly the quarantine program had been carried out.

    2. Policy on Non-Medical Masks or Face Coverings

      The Policy on Non-Medical Masks or Face Coverings was received for information. There were no questions from members.
  3. Agreement between the University of Toronto and the University of Toronto Faculty Association regarding proposed revisions to the Policy and Procedures on Employment Conditions of Part-time Academic Staff, 1994

    The Chair advised that under Section 5 of the Business Board’s Terms of Reference, contractual relations with employee groups fell within the Board’s areas of responsibility. Since the proposal concerned a policy relating to academic employment, the Academic Board would also consider the item. If recommended by both Boards, the matter would be presented to the Governing Council for final decision.

    Professor Heather Boon, Vice- Provost, Faculty and Academic Life, made a presentation which highlighted key elements of the proposed revisions to the Part-Time Policy and related policy changes.

    In response to a member’s question regarding financial implications, Professor Boon responded that there were no changes to benefits to which those part-time teaching staff were eligible and that the Policy codified what had been recommended across academic units with respect to severance and other benefits, so it was consistent across all units.

    On a motion duly moved, seconded, and carried


    THAT the Memorandum of Settlement Between the University of Toronto Faculty Association and the University Administration, dated May 7, 2020, regarding the Policy and Procedures on Employment Conditions of Part-time Faculty be approved, effective immediately.
  4. Annual Report: Vice-President, Advancement

    The Board received the Vice-President, Advancement’s (VPA) Annual Report entitled University Advancement Performance Indicators (FY 2019-2020) for information. A copy of the Vice-President’s presentation on Advancement’s past fiscal year, its impact during COVID, and the current planning for the bicentennial campaign, were also made available to members.

    David Palmer, Vice-President Advancement, began by thanking the Business Board for the opportunity to present on Advancement’s year end and what lies ahead for the current campaign. Mr. Palmer introduced the senior members of his team and thanked them and divisional advancement teams across the University for their many contributions to the fiscal year just past.

    Mr. Palmer referred to the announcement two weeks earlier of the $250 million gift from the Temerty family via the Temerty Foundation to the Faculty of Medicine. He heralded the gift not only for its immense generosity and benefit to the University and to Medicine, but also for its emphatic statement of the importance of philanthropy, optimism, and hope in a time of such economic uncertainty and social stress. The VPA stated that he hoped this announcement would encourage others to step forward with similarly inspired generosity.

    With regard to the fiscal year that finished on April 30, 2020, Mr. Palmer noted that the annual fundraising results fell slightly short of expectations, approximately 6% shy of the University’s $250 million goal, partly owing to last quarter impacts of COVID-19. He reported that alumni engagement measures exceeded their goals for the fiscal year, and that the brand hub had a particularly productive year in promoting advancement activities to all constituencies.

    In terms of the impact of COVID-19, Mr. Palmer noted that alumni relations had pivoted very well following the cancellation of hundreds of alumni events in the spring. Alumni Relations launched the new StayHome Alumni Hub, which gathered together and presented content from all University divisions, including online seminars, lectures, lessons, and special interest activities, aimed at VPA’s external constituents (alumni, donors, volunteers, friends). As a result, during COVID, the University saw alumni engagement measures increase above the prior year’s record results.

    This high degree of alumni engagement reflected its audience’s thirst for community and connection, for authentic information, for curated knowledge and experiences during a time of social distancing and isolation. It also reflected a shift in how the DUA’s alumni relations team and their colleagues across the University were stepping up to embrace the digital age and pursue innovation.

    Looking ahead, and mindful that the mid-term impacts of COVID on its programs had to be assessed, Mr. Palmer stated that he remained confident in the long-term horizons for giving and engagement. As a result, the University was still proceeding with the existing plans and parameters for its bicentennial campaign including a stretch financial goal and, for the first time, an ambitious alumni engagement goal as a publicly announced campaign objective.

    The Chair thanked Mr. Palmer for his report. (see item 5 re members’ comment on VPA Annual Report presentation)
  5. Annual Report: Vice-President, Communications

    The Board received the Annual Report (2019-2020) of the Vice-President, Communication for information.

    Highlights from the presentation include:
    -strengthening the University’s brand;
    -building on Tri-Campus Integration;
    -collaboration with Simcoe Hall Portfolios, Faculties and Divisions;
    -“Protect, promote and enhance our reputation” – media relations, issues management, social media;
    -communicating Task Force on Student Mental Health’s Final Report;
    -Vice-President Communications Renewal;
    -response to Ukraine International Airlines Crash in Iran; and
    -COVID-19 response: The events of this last year had allowed for an acceleration of the trends and work VPC were already doing and reinforced the need for clear, effective, consistent and timely communications;
    -opportunities provided for innovation – which resulted in the creation of new and expanded digital engagement tools and products such as two podcasts, the website and two YouTube video series; and
    -the pandemic had also exposed the need for greater coherence in communications efforts and the power of collaboration.

    The Chair thanked Mr. Estok for his report. The Chair reiterated the members’ comments that both the VPA and VPC’s presentations of their respective Annual Reports were of high quality and very informative – she extended a special note of congratulations for the funds that had been raised for the University, especially during COVID-19.
  6. Investments: Semi-Annual Update on Investment Performance to June 30, 2020

    Ms Sheila Brown, Chief Financial Officer reported that there were three pools of funds that UTAM managed: the expendable funds investment pool (EFIP) which included operating, ancillary, expendable donations, capital and research funds; a long-term capital appreciation pool (LTCAP), which included funds invested for the long-term, including, predominantly endowments, and; the Pension Master Trust (PMT or Pension). Each investment pool had its own risk profile, target return and investment strategy. She also noted that EFIP and LTCAP had a May to April fiscal year, and that the PMT had a July to June fiscal year. All funds were under the management of the University of Toronto Asset Management Corporation (UTAM), which itself had a January to December fiscal year. Ms Brown referred members to the Investment Placemat (Investments: Who Does What?), which described the delegated roles and responsibilities of the administration, the Business Board, the Pension Committee and the Investment Committee with respect to investments of the University’s Endowment Fund and Pension Master Trust.

    Mr. Daren Smith, President and Chief Investment Officer, University of Toronto Asset Management Corporation (UTAM), made a presentation on investment performance for the 6-month period ending June 30, 2020 and for longer periods of time.

    Mr. Smith highlighted the following key points related to investment performance for LTCAP, EFIP and Pension:

    -over the first half of the calendar year (H1 2020), LTCAP and Pension assets generated returned -2.5% and -2.4%, respectively, while EFIP short-term returned 2.2% and EFIP medium-term returned 5.9%; both LTCAP and Pension underperformed the Target return;
    -the 5-year LTCAP and Pension results were approximately equal to the Target returns while the 10-year results exceeded the Target returns;
    -the Reference Portfolio returned 0.4% in H1 2020, underperforming the Target return by 1.3% (returns had exceeded the Target Returns over 1, 5- and 10-year horizons);
    -in H1 2020, LTCAP and Pension underperformed the Reference Portfolio by 2.9% and 2.8%, respectively;
    -over the last 5 years ending June 30, 2020, value add in Pension and LTCAP was -0.4%, and over the last 10 years it was 0.8% for LTCAP and 0.7% for Pension;
    -dollar value add in H1 2020 for Pension and LTCAP combined was negative $246.3 million and for the past 12 months it was negative $261.9 million;
    -over the last 10 years: UTAM’s value add for Pension and LTCAP was $268.2 million; one-year performance (June to June) was positive from 2011 to 2018 and negative in 2019 and 2020;
    -recent performance had been challenging in a number of areas (i.e. Risk-Reducing Trades, Private and Public Equity), but most investment categories had added value over the long-term;
    -all asset class exposures in LTCAP and Pension were within allowable bands at the end of June 2020;
    -Active Risk for LTCAP and Pension remained well within the “Normal” Zone (-50 bps to 100 bps) at the end of June 2020; and
    -all reported return percentages were net of all investment fees and expenses, including UTAM expenses.

    In response to members’ questions and comments, Ms Brown and Mr. Smith responded with the following:

    -when comparing fees from one institution to another it was important to take into account differences in asset mix and investment strategy. Some investment strategies such as private equity and hedge funds were more expensive than other investment strategies such as public equity investing. UTAM only allocates to an investment manager when it believed the manager was likely to outperform net of all fees and expenses.
    -Manager performance should be evaluated over a longer period of time (e.g., 10 years);
    -UTAM considers more than just performance when evaluating potential changes to investment managers. The additional factors include changes to people and investment process.
    -UTAM did not expect to make significant changes in the external manager line up – many of UTAM’s managers had strong performance over long term. However, there are likely to be some changes on the margin.
    -given the recent underperformance, UTAM will be reviewing all aspects of its investment strategy.
    -an update on how the University would be managing its endowment fund investments after July 1, 2021 would be part of a future UPP update;

    A member commented that the new performance attribution table by investment category was helpful. Mr. Smith indicated that his team was working on a version of the table that would cover a longer period of time and that he hoped it would be ready for the next Business Board meeting where investment performance was scheduled to be discussed.

    The Board received the Semi-Annual Update on Investment Performance to June 30, 2020, for information.

    The Chair thanked Mr. Smith and Ms Brown for the report.
  7. Endowment Annual Financial Report for the Year ended April 30, 2020

    The Board received the Endowment Annual Financial Report for the Year ended April 30, 2020, for information.
  8. Status Report on Debt to September 30, 2020

    The Status Report on Debt to September 30, 2020 was received for information.
  9. Health and Safety: Quarterly Report on Compliance,

    The Quarterly Report on Compliance (June 1, 2020 – September 30, 2020) was received by the Board for information.
  10. Reports of the Administrative Assessors

    Professor Mabury reported that the Board should expect roughly the same number of Capital Project proposals from all campuses (at least in terms of value) as compared to the previous year.

    In response to a desperate need of space, the VPOREP stated that a number of projects were in the pipeline for approval and construction in the new year and subsequent years.


    On motion duly moved, seconded and carried


    THAT the consent agenda be adopted.
  11. Approvals Under Summer Executive Authority

    The report on Approvals Under Summer Executive Authority was received for information.
  12. Report of the Previous Meeting

    Report number 253, from the meeting of June 18, 2020, was approved.
  13. Business Arising from the Report of the Previous Meeting

    There was no business arising from the report of the previous meeting.
  14. Report Number 138 of the Audit Committee (June 17, 2020)

    Report number 138 of the Audit Committee, June 17, 2020, was received for information.
  15. Credit Reports: Dominion Bond Rating Service (DBRS) and Moody’s Investor Services

    The reports were received for information.
  16. Calendar of Business, 2020-2021

    The Calendar of Business (2020-2021) was received for information.


  1. Other Business

    The Chair advised that Board members would receive an email from the Secretary regarding the Business Board Striking Committee membership for 2020-21.
  2. Date of the Next Meeting – Wednesday, November 25, 2020

    The Chair advised members that the next meeting would be Wednesday, November 25, 2020 starting at 5:00 p.m.


The Board moved In Camera

  1. In Camera Reports of the Administrative Assessors (oral reports)

    There were no in camera reports of the administrative assessors.
  2. Quarterly List of Donations of $250,000 or more to the University of Toronto – May 1, 2020 to July 31, 2020

    The Quarterly Report was received by the Board for information.
  3. Compensation Increases for Professional, Managerial and Confidential Staff,

    Advancement Professionals and Senior Research Associates/Research Associates

    On motion duly made, seconded and carried


    The recommendation of Professor Kelly Hannah-Moffat, Vice-President Human Resources and Equity, as outlined in the memorandum dated September 22, 2020, regarding Compensation Increases for Professional, Managerial and Confidential Staff, Advancement Professionals and Senior Research Associates/Research Associates.
  4. Collective Agreements:
    1. Collective Agreement between the University of Toronto and CUPE Local 3261, Full-Time and Part-Time: July 1, 2020 – June 30, 2021

      The Collective Agreement was received by the Board for information.
    2. Collective Agreement between the University of Toronto and USW Local 1998 (Staff-Appointed) July 1, 2020 – June 30, 2021

      The Collective Agreement was received by the Board for information.

The Board returned to open session.

The meeting adjourned at 7:07 p.m.

October 7, 2020