With a theme of “Human Resources and Equity,” I knew this meeting was going to be a non-stop thrill ride of business. First on the agenda was the annual report of Angela Hildyard, the Vice-President of HR and Equity, followed by a high-octane review of employment equity and health and safety. After that, the finance guys from the University of Toronto Asset Management corporation (UTAM) gave their annual report and presentation on the humongous pile of money that they look after, while making everyone feel like they had suddenly entered an economics lecture. Transitioning from the pile of money we have to the pile of money we’ve borrowed, Sheila Brown, UofT’s CFO gave a report on our debt strategy. Lastly, a motion was passed approving the budget for the group that looks after all those houses in the Huron-Sussex neighborhood that we own… apparently.
Like any student politician looking to procrastinate and snag a free coffee & cookie, I went to this meeting.
THE HR REPORT
- Apparently HR has joined the 21st century and now uses LinkedIn to recruit. Cue joke from Prof. Hildyard about how she, as an older person, doesn’t understand this “new-fangled social media nonsense”
- The university is writing articles called “off the clock” to show that the people that work here have lives. I’ve read some of these, and they’re surprisingly interesting. Did you know that VP University Operations Scott Mabury has a farm? Now you do.
- The university wants to remind people that it employs people, presumably with the hope that they can cash in on the current political trend of worshiping at the altar of “job creation”.
- Here at U of T, we take a proactive approach to equity and diversity (in stark contrast to the approach where you wait for someone to complain), and equity officers actually get to meet with senior admin on a regular basis. Kudos to U of T here.
- The amount of sick days our staff take is about the same as what other staff take. Not really much to add to that…
- An increasing number of health issues among U of T staff are mental-health related. This is a trend seen across many sectors, especially with students.
- There have been more slip-and-falls this year, because winter.
- With 23 unions, U of T is always in bargaining with someone. This year, around 20 agreements have to get done, which is a lot. U of T is pretty good at getting things sorted within the normal time frame, and doesn’t usually have labor problems, unlike other universities *cough York cough*.
- We’ve had a slight decrease in visible minorities on staff (down to 23%). Furthermore, the amount of people who are aboriginal or disabled is lower than estimated in the qualified applicant pool, though this may be due to employees not self-reporting.
- U of T doesn’t use the quota system (affirmative action) to improve diversity, it runs proactive programs instead.
- Despite the fact that we’re 77% visible not-minorities, BMO has designated us a top-diversity employer, and lots of people cite this as a reason to want to work here.
- We now have equity officers for all campuses! They’re great. Also, we have a family care office, which is reaching its 20-year anniversary this year.
- The university is pretty confident that, adjusted for qualifications, men and women are pretty equal for pay. We don’t have good info on minorities though, which is a little concerning. Apparently USW has been pushing for changes to help improve pay equity.
UTAM ANNUAL REPORT
- We made lots of money this year! (but the pension is still way, way in the hole…)
- The evaluation of our money management people is done using a benchmark portfolio set by the university which tracks market returns for a bunch of indexes like the S&P 500. (Fun side note: did you know that no-one uses the DOW? It’s apparently the most useless stock market index, because it was designed to be easy to calculate, not accurate.)
- Volatility=standard deviation of returns. Private investments are less volatile than public ones, apparently. We own both.
- UTAM outperformed the benchmark portfolio by about 3% this year, and in all categories except US equities (because our equities are private and public, and the benchmark is public-only).
- Don’t buy bonds. Basic math shows that they’ll have a bad return in the next ten years. All of this advice on investing is going to be useful for the huge piles of extra money I don’t have.
- Return for US equities are probably going to be better, though once central bankers stop their QE magic, the market will cool down a bit.
- A passive portfolio (i.e. made of low-fee index funds) probably won’t make that much money in the next ten years, especially because inflation will probably go up. This is bad advice for mom-and-pop investors, as they don’t really have the same economy of scale with asset management as U of T.
- We hedge currencies, which is good because some of our research grants are in other currencies. Also, we’re hedging less of them than in 2008 because I think we lost lots of money that way.
- We’re still recovering from all the money lost in 2008-2009, so endowment payout isn’t going up any time soon.
- We don’t use the magic of leverage very much, which is good, because leverage=borrowing money to buy stocks/bonds/etc. and hoping things work out. Apparently we only use it when shorting as apparently most people do.
THE DEBT STRATEGY
- Our strategy is to spend less than 5% of the operating budget paying back debts every year (this is called the “loan burden ratio”. More than that would be bad, probably, unless you’re a student on OSAP, in which case, the university pats itself on the back for having loan burden ratios go below 8%. (Grumble Grumble…)
- If U of T had to pay back all of our debts today, it’d be able to pay most of them using cash on hand, and all of them by breaking open the metaphorical piggy bank (the endowment) with a hammer. This isn’t really something that can happen, it’s just a scenario that U of T thinks about sometimes when it’s feeling bored, or has hiccups and needs to be scared by something.
- The money for the pension special payments is somehow related to debt. I plan to find out why, because right now, I have no idea.
- Cue grumbling about not being able to raise tuition more. Apparently U of T was hoping to keep raising everyone’s tuition by 5% a year. Dang it, they had used that number for the financial projections and everything.
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