Thanks to its proactive risk management strategy, the Plan is able to fulfill its commitments. The strategy is constantly evolving, positioning us as a leader in industry best practices.
We rely on modelling, projections and simulations that are continually updated and used as a basis for risk-taking decisions. Integrated, dynamic management of all of the Plan’s risks is a strategic driver of performance. Risk management is a key part of building the overall portfolio and informs all investment decisions.
We take sufficient risks to ensure adequate long-term returns, while implementing strategies to stabilize and maintain the sound financial health of the Plan under a range of possible scenarios.
Main risks
| Interest rate
Interest rate fluctuations have a direct and substantial effect on the Plan’s financial health.
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| Life expectancy
Plan members living longer than expected or updates to mortality tables could drive costs up.
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| Market
Market volatility could lead to negative returns, which would impact the contributions needed to properly fund the Plan.
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| Liquidity
The Plan must have enough money available to fulfill its financial obligations at all times.
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Risk mitigation measures
Comprehensive risk register
Dynamic dashboards help identify the main risks related to the Plan’s administration and financial management. Each risk is assessed and tracked using indicators with set targets and ranges. The tracking process helps make sure we meet objectives by identifying the causes when risk levels are exceeded and correcting the strategy if needed.
Risk systems
Industry-recognized risk management tools are used to thoroughly quantify, assess and manage the financial risks associated with all of the Plan’s assets and liabilities.
Investment support
Our risk management experts work with our asset managers to make sure we’re taking the right amount of risk each time we invest and build portfolios.
Resilience during financial crises
We actively take part in Desjardins Group’s integrated stress test exercises to ensure that the Plan is resilient in various financial environments.
Customized mortality table
To better estimate how long Plan members will live, we customize the standard Canadian mortality tables on an annual basis using actual DGPP members’ experience and socioeconomic analyses.
Climate risks
We developed and completed the initial quantifications of climate risks that could affect Canadian real assets. One of our key priorities is the Plan’s resilience to climate change.