Report: Business Board - April 27, 2021

Via Virtual Meeting


Tuesday, April 27, 2021

To the Governing Council,
University of Toronto.

Your Business Board reports that it held a virtual meeting on Tuesday, April 27, 2021 at 5:00 p.m. with the following members:

Anna Kennedy (Chair), Bruce Winter (Vice-Chair), Brian Lawson, Vice-Chair of the Governing Council, 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, Joan Johnston, Kikelomo Lawal, Jan K. Mahrt-Smith, Rajiv Mathur, Brian A. Miron, Andrew Padmos, David Regan, Susan Rodgers, Danielle Skipp, Ian Taylor, Vishar Yaghoubian

Kathryn A. Jenkins, Amin Kamaleddin

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

Non-Voting Assessors:
David Estok, Vice-President, Communications, David Palmer, Vice-President, Advancement, Christine Burke, Assistant Vice President, University Planning, Operations and Real Estate Partnerships, Anne Macdonald, Assistant Vice-President, Ancillary Services, Trevor Rodgers, Assistant Vice-President, Planning and Budget, Joshua Mitchell, Director, Real Estate

In Attendance:
Veronica Wadey, Governor-Elect, Angela Hildyard, Special Advisor to the President, Edward (Ted) Sargent, Vice-President Research and Innovation, Elizabeth Brown, Brown Mills Klinck Prezioso LLP, Elizabeth Cragg, Director, Office of the VPOREP, Rosalyn Figov, Chief Operations Officer, Office of the VPHRE, Roger Francis, Executive Director, EXCEL, FASE, Heather Kelly, Executive Director, Student Life, Programs & Services, Signe Leisk, Cassels, Vicki Lowes, Director, Experiential Learning and Outreach Support, FAS, Owen McCartney, Development Finance Analyst, Steve Moate, Office of the President, Derek Newton, Assistant Vice-President, Innovation, Partnerships and Entrepreneurship, Adrianna Pilkington, Cassels, 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 11-15 were considered in camera.


  1. Chair’s Remarks

    The Chair welcomed members and guests.  
  2. Reports of the Administrative Assessors

    Scott Mabury, Vice-President, Operations and Real Estate Partnerships, provided an update as of April 27, 2021 on issues and initiatives as they interfaced with the COVID pandemic.  Highlights included the following:

    Information Security
  • ITS had improved security by introducing a Multi Factor Authentication (MFA) solution which included a modern Firewall, an Incident Response Plan and retainers;
  • Academic Divisions had completed a self-assessment as part of their accountability under the policy to maintain an information security risk management plan – in aggregate, divisions were not meeting institutional targets and reported challenges having local expertise and priority;
  • Post-pandemic remote work would not be the same and would require investments and prioritization – SecureU(of T) moved institutional level initiatives forward but divisions would need to fund and prioritize local risk mitigation;
  • Research security risk was rapidly increasing, both real risk from criminals & nation state actors (i.e. espionage & disruption) and increasing sponsor compliance requirements – Research & Information Security (and others) were working together to address at institutional level; and
  • CanSSOC, a joint security project initiated by six Canadian universities and the national research network, continued to expand services nationally and build international relationships with other research and education SOCs, particularly in USA – the project was seeking significant federal funding to enhance shared services. 

    Wastewater Surveillance
  • University was monitoring COVID-19 in residences by sampling wastewater as part of a pilot project with the most populated residences (2 residences with 250+ students) – launched February 2021;
  • Pilot was in partnership with Faculty members in the Departments of Chemistry, and Chemical Engineering, the Ministry of the Environment, Conservation and Parks, and a commercial lab;
  • As part of the initial pilot findings:
    • University successfully detected presence of the COVID-19 virus in wastewater, enabling a proactive response and avoidance of an outbreak
    • developing plan to scale to more residences for Fall 2021, and
    • Response protocols would leverage deployment of rapid screening

Rapid Screening Pilot

  • Phase 1 of the Pilot was proposed to focus on the higher interaction and essential services group currently on campus. Pilot sites included: Dentistry Clinic staff, learners, faculty; Health and Wellness clinic staff ; and on-site essential workers that interacted with the public (e.g., Campus Safety); and
  • Pilot was a voluntary rapid screening program that provided 15-minute results and integrated with U of T's UCheck applications (health self-screening program).

    Classroom Ventilation Preparedness Plans
  • As part of the Fall 2021 Classroom Preparedness, the University was undertaking the following:
    • performing an HVAC assessment, including conducting air surveys, to determine air flow rates in classrooms
    • setting a target ventilation rate of 6 air changes per hour (ACH) that had been recommended for classroom environments when they were in use
    • executing ventilation measures in classrooms that do not meet the ACH target, such as by adding air purifiers to supplement air flow.

Tri-Campus Ventilation Strategy Highlights

  • all HVAC systems reviewed to ensure proper operations, in addition to regular maintenance;
  • MERV 13 enhanced filtration installed at all compatible locations;
  • where ventilation systems were scheduled, all had been adjusted to ensure 2 hours of air flushing pre-occupancy; demand control ventilation had been disabled; and 
  • University had updated the tri-campus HVAC strategy (as of April 2021).

    Capital Projects Update:
  • construction had not slowed significantly and projects have progressed to pre-pandemic levels;
  • delivery of construction projects during the pandemic had necessitated on campus attendance for number overseers such as project managers; and
  • to support active sites and to service the number of projects undertaken by the University, all public health guidelines continue to be applied.

    In response to members’ comments and questions, Professor Mabury, stated the following: 
  • the University’s pilot project was not the only collaboration with the Ministry of the Environment; 
  • OREP was developing plans to scale pilot project to more residences for Fall 2021 across the tri-campus; and
  • the latest lock-down by the Province did not capture University capital projects in progress.

    The Chair thanked Professor Mabury for his remarks.  

    There were no other reports of the Administrative Assessors
  1. University of Toronto Asset Management Corporation (UTAM): Annual Report and Financial Statements, 2020

    The Chair stated that under the Business Board’s Terms of Reference it was responsible for approval of the investment risk and return targets for University funds, but not for pension funds, which were approved by the Pension Committee together with the asset allocation and other elements required to be included in the pension Statement of Investment Policies and Procedures. Asset allocation and other elements of investment strategy for University funds were delegated to the President. 

    The Chair thanked members for submitting written questions prior to the meeting.

    Sheila Brown, Chief Financial Officer, stated that the Business Board was responsible for reviewing annual reports for both University and Pension funds, which included information on asset allocation, an example of which was the UTAM Annual Report, 2020.

    Daren Smith, President and Chief Investment Officer (CIO), University of Toronto Asset Management Corporation (UTAM) presented the UTAM Annual Report and Financial Statements, 2020.  Highlights of the presentation included the following:
  • Assets under management increased by 14.4% in 2020 to approximately $13.0 billion;
  • Long-term assets were valued at $9.9 billion at the end of December 2020, a 12.7% increase over the year;
  • In 2020 (i.e., 1 Year), LTCAP returned 11.6%, Pension returned 11.7% and EFIP returned 3.9%
  • Over the last 10 years, LTCAP returned 8.8% annualised, Pension returned 8.7% annualised and EFIP returned 2.1% annualized
  • LTCAP and Pension outperformed the Target return by approximately 7% in 2020;
  • Over the last 10 years, LTCAP and Pension outperformed the Target return by over 3% annualized (i.e., per year);
  • the Reference Portfolio returned 11.8% in 2020, outperforming the Target return by 7.1%. The Reference Portfolio has also exceeded the Target return over 5 and 10 year horizons;
  • UTAM had a very strong second half of 2020, outperforming the Reference Portfolio by over 3% in Pension and LTCAP. For the full year, Pension underperformed by 0.02% and LTCAP underperformed by 0.17%;
  • Over the last 5 years, Pension and LTCAP underperformed the Reference Portfolio by -0.2%, but over the last 10 years both portfolios outperformed by approximately +1.0%;
  • UTAM added over $250 million in value to LTCAP and Pension combined in the second half of the year, and approximately $20 million in all of 2020;
  • Over the last 10 years, UTAM has added in excess of $0.5 billion in value to the LTCAP and Pension portfolios combined;
  • UTAM’s average 5-year value add for the years ending 2014 to 2020 was approximately 1.5%;
  • 2020 was the first five-year period over this timeframe that UTAM value add was negative;
  • In 2020, EFIP outperformed its Target return by 0.5%, and added $11.8 million in value;
  • Over the last 10 years, EFIP outperformed its Target return by 0.3% annualized and added $39.3 million in cumulative value;
  • Active Risk for LTCAP and Pension was well within the “Normal” Zone of -0.50% to +1.50% at December 31, 2020;
  • At the end of December 2020, LTCAP and Pension were in compliance with all asset mix limits.

    Mr. Smith commented on UTAM’s 2020 responsible investing activities and highlighted the following:
  • Decarbonisation of the Pension and Endowment portfolios is well on track. As of December 31, 2020, the carbon footprint of the portfolio (carbon emissions per million dollars invested) was 37.0% lower than in 2017, and the absolute level of emissions were 21.1% lower;
  • In 2016, UTAM became a signatory to the United Nations–supported Principles for Responsible Investment, the world’s leading proponent of responsible investment. In the PRI’s most recent assessment, UTAM received the highest possible score in all assessed categories;
  • In June 2020, UTAM was added to the Institutional Limited Partners Association (ILPA) ESG Roadmap and Resources, a compilation of best practices that limited partners can consider implementing to advance environmental, social and governance (ESG) investing efforts at their organizations;
  • In August 2020, UTAM was shortlisted for an International Corporate Governance Network (ICGN) Global Stewardship Disclosure Award. This award recognized investors whose public disclosures provide genuine insight into their stewardship policies and how they had been implemented, and whose approach to transparency and reporting provides a model that others might follow;
  • In October 2020, UTAM was chosen as one of the three finalists for Canadian Investment Review’s first Pension Leadership Awards in the category of Sustainable Investing. The awards celebrate pension plan sponsors and pension investors who work hard to ensure strong investment outcomes;
  • UTAM on behalf of the University of Toronto recently became a founding member of the University Network for Investor Engagement (UNIE), a coalition of Canadian university endowments and pension plans that will leverage the collective power of this group as institutional investors to address climate change risks in each of its investment portfolios. UNIE’s coordinator is SHARE (Shareholder Association for Research & Education), a non-profit investor advocacy organization;
  • In 2017, UTAM, on behalf of the University of Toronto, became a founding participant in Climate Action 100+, now the largest-ever investor engagement initiative on climate change. The initiative focuses on engagement with 167 companies that have significant greenhouse gas emissions and/or are critical to the net-zero emissions transition and to meeting the objectives of the Paris Agreement. Significant progress was achieved in 2020 with many companies;
  • In 2020, through Hermes EOS, UTAM engaged with 815 companies in the Pension and Endowment portfolios on 2,914 environmental, social, governance, strategy, risk and communication issues and objectives. Of these, 1,346 were linked to one or more of the UN Sustainable Development Goals (SDGs); In 2020, after an extensive global search by UTAM’s public equities team, it identified Impax Asset Management as a leader in responsible investing and a manager that would be a great fit in the pension and Endowment portfolios. Impax is a specialist asset manager investing in the opportunities arising from the transition to a more sustainable global economy. 
  • UTAM believes their overall approach to responsible investing is one of the best in the industry. It partnered with Impax to create a new tax-efficient investment vehicle and invested with them in early 2021.
  • In 2020, UTAM worked with one of its long-standing fixed income managers to create a new investment mandate with a requirement to have significantly lower carbon emissions than the benchmark index. The portfolio proactively invests in companies with a strong track record of reducing GHG emissions or credible plans to do so in the future; and
  • Since the beginning of 2020, 13 of the managers in the Pension and Endowment portfolios have joined the PRI. In many cases, due in part to UTAM’s influence.

    The Chair thanked Mr. Smith for his detailed report and agreed with members’ comments that Mr. Smith and Ms Brown be recognized for their work and the excellent achievements, including the investment performance results by UTAM.  A member noted that pension industry trade press had also recognized the success of UTAM.

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

•    It was common industry practice to measure, report and set targets based on carbon emissions per million dollars invested or carbon emissions per millions dollars of sales. 
•    Given that the decarbonization targets have almost been reached, UTAM and the university were considering possible changes to the target for Endowment.
•    The University did not benchmark investment returns against other pension plans (such as OMERS, HOOP or TEACHERS) because of differences in performance objectives, return targets, risk tolerances, strategic asset allocations, etc. that make such comparisons challenging.
•    UTAM has been working with the UPP’s recently formed management team to facilitate the transition, leveraging its expertise and experience in university asset management.

The report was received by the Board for information.

  1. University Development and Campus Services (UDCS): Annual Report 2020-21 and     Budget 2021-22 AND 4 Corners Annual Report 2020-21

    The Chair noted that under its Terms of Reference, the Board reviewed and approved the annual budget of unincorporated business ancillaries. 

    Professor Mabury stated that this was the inaugural presentation of the annual report for the University Development and Campus Services portfolio which was established by the Business Board in 2020. He added that the new UDCS ancillary operation brought together St. George campus Ancillary Services and the tri-campus mandate of the university’s Real Estate department, both part of the division of Operations and Real Estate partnerships.  

    Anne Macdonald, Assistant Vice-President, Ancillary Services reported that the activities and operations of UDCS included faculty housing, student family housing, student residence outside of the colleges, academic and commercial leasing, residential and retail dining, campus events and catering, real estate acquisition, transportation services, and trademark protection and licensing. UDCS also supported the 4 Corners strategy, which worked to leverage the university’s real estate assets to deliver amenities to support the academic mission and simultaneously grow revenue from sources other than enrolment.

    Ms Macdonald and Josh Mitchell, Director, Real Estate highlighted the following as part of their presentation:
  • due to COVID, the portfolio experienced a 53% decline in revenues representing a $20.8 million forecasted net loss – extensive and difficult cost mitigation activities had been undertaken;
  • UDCS continued to support students and the campus community: virtualised programs and services, led the institutional quarantine program, developed expertise in delivery of high-quality virtual events, assisted commercial tenants; It also continued to advance strategic work strengthening collaboration across teams and building strong foundations for UDCS;
  • UDCS projected a steady rate of financial recovery with over 50% revenues growth in 5 years; it would also reduce its total capital debt by almost $51M in the same period;
  • 4 Corners Strategy was proposing over 4.2M square feet of buildable space by 2033;
  • despite the pandemic’s negative impact on Real Estate’s leasing revenues, which serve as important seed capital for the first tranche of 4C projects, the portfolio made progress on three important objectives in 2020: building foundations, promoting innovation, and supporting the university community;
  • the Real Estate portfolio added staff and expertise in the areas of financial analysis and negotiation support, and advanced key projects such as the Schwartz-Reisman Innovation Campus and Spadina Sussex; 
  • 15 year projection included the delivery of 3,952 university housing units; 
  • portfolio also strengthened relationships with its Real Estate Advisory Committee to help guide the 4C vision and provide feedback on more than 4 million square feet of future development potential – it would continue to monitor economic recovery with careful consideration of available revenues and the goal of generating $50 million annually in operating funding within the next 15 years. 

    There were no further questions from members.

    On motion duly moved, seconded and carried


    THAT the Business Board concur with the recommendation of the University Affairs Board’s approval of the UDCS fees charged to students and the University community; and

    THAT the proposed 2021-22 operating plans and budgets for University Development and Campus Services, as summarized in the UDCS Annual Report Appendix A, and the St. George business ancillary rates as summarized in Appendix B, be approved effective May 1, 2021.


On a motion duly moved, seconded, and carried

THAT the consent agenda be adopted.

  1. Report of the Previous Meeting

    Report Number 257 from the meeting of March 17, 2021 was approved. 
  2. Business Arising from the Report of the Previous Meeting

    There was no business arising from the Report of the previous meeting.
  3. Status Report on Debt to March 31, 2021

    Members received the Status Report on Debt to March 31, 2021, for information.
  4. Health and Safety Requirements: Quarterly Report on Compliance – January 1 to March 31, 2021 

    Members received the Quarterly Report on Compliance (January 1 to March 31, 2021), for information.


  1. Date of the Next Meeting – Thursday, June 17, 2021

    The Chair reminded members that the date of the next meeting was Thursday, June 17, 2021 at 5:00 p.m.   
  2. Other Business

    There was no other business.

The Board Moved In Camera

  1. In Camera Reports of the Administrative Assessors

    Update: University Pension Plan Ontario [“the UPP”]

    Professor Angela Hildyard provided an update on the University Pension Plan [“the UPP”].

    The were no other in camera reports from the Administrative Assessors.
  2. Collective Agreement: University of Toronto and CUPE 3902

    The Collective Agreement between the University of Toronto and CUPE 3902, Unit 1 (January 1, 2021 – December 31, 2023) was received by the Board for information.
  3. Capital Project: Report of the Project Planning Committee for the UofT Experiential  Hub at 203 College Street - Execution of the Project

    On a motion duly moved, seconded and carried 


    The recommendation of Professor Scott Mabury, Vice-President, Operations and Real Estate Partnerships, as outlined in the memorandum dated April 17, 2021, regarding the execution of the UofT Experiential Hub at 203 College Street capital project.
  4. Property Matter

    On a motion duly moved, seconded and carried 


    The recommendation of Professor Scott Mabury, Vice-President, Operations and Real Estate Partnerships, as outlined in the memorandum dated April 17, 2021, regarding a property matter.

Extension of Virtual Meeting

 On a motion duly moved, seconded, and carried

THAT the Business Board meeting be extended.

  1. Proposal: TRIUMF Joint Venture Restructured into TRIUMF INC.

    On a motion duly moved, seconded and carried 


    The recommendation of Professor Edward (Ted) Sargent, Vice-President Research and Innovation, as outlined in the memorandum dated April 18, 2021, regarding the Proposal: TRIUMF Joint Venture Restructured into TRIUMF INC.

The Board returned to Open Session. 

The Chair thanked members for their attendance and participation in the virtual Board meeting.

The meeting adjourned at 7:38 p.m.

April 30, 2021