We’re pleased to announce the publication of our 2020 Annual Report, titled NEXT. It includes details about the performance of the Pension, Endowment and short-term working capital investments we manage on behalf of the University of Toronto. In addition, the report focuses on the strengths that continue to make UTAM a resilient organization, have helped us navigate the global pandemic, and have set us up well for the future. Below, we share a few highlights from the report.

Investment returns

In 2020, the Pension and Endowment portfolios delivered returns of 11.7% and 11.6% (net of all fees and expenses), respectively, matching the benchmark Reference Portfolio return in Pension and underperforming the Reference Portfolio return in Endowment by 0.2%.

The long-term performance of the Pension and Endowment portfolios continues to be strong. Over the last 10 years, Pension has generated an annualized net return, after all fees and expenses, including UTAM costs, of 8.7%, and the Endowment generated 8.8%. These results exceeded the Reference Portfolio benchmark by 1.0% annualized in Pension and 1.1% annualized in Endowment, resulting in over $500 million in cumulative value add for both portfolios combined.

Responsible investing

We are pleased to announce that we made significant progress towards our goal of reducing the carbon footprint of the Pension and Endowment portfolios by 40% compared to 2017 levels. As of December 31, 2020, the Pension’s footprint was 87.7 tonnes of carbon dioxide equivalent per million dollars invested (tC02e/$M), representing a 37.0% cumulative reduction since 2017. (Since the Pension and Endowment portfolios are substantially similar, we use the carbon footprint of the Pension portfolio as a proxy for the footprint of the Endowment portfolio.) Importantly, the absolute carbon emissions of the Pension portfolio at the end of 2020 were 21.1% lower than 2017 levels.

We received straight A+ scores in our third annual PRI assessment, once again scoring higher than the median PRI signatory in all applicable categories. We were also honoured to be nominated for awards from the International Corporate Governance Network (ICGN) and Canadian Investment Review, and to be included in the Institutional Limited Partners Association (ILPA) compilation of ESG best practices. We will share more information about our responsible investing activities in our annual responsible investing report, expected to be released this fall.

Active ownership, including engagement with companies, is a key part of our approach to responsible investing. We undertake select direct engagements, but more often we collaborate with other investors through informal and formal groups, including Climate Action 100+, CDP, the Canadian Coalition for Good Governance and others, as well as through our engagement service provider, EOS at Federated Hermes. And during 2020, we saw many important milestones achieved at companies that were engaged, including new commitments to reduce carbon emissions.

We’re pleased to share with you what comes NEXT. Visit the news section of our website for frequent updates on our activities throughout the year.

Download the 2020 Annual Report