Pension Commission
The WELS Pension Plan is overseen by the Pension Commission. The Pension Commission is composed of six members: 1 Pastor, 1 Teacher, and 4 Lay Workers. Each member brings a unique perspective and background to the commission. The current Pension Commission members are:
- Mr. Gene Szaj, Chairman
- Rev. David Kolander, Vice-Chairman
- Teacher Scott Uecker, Secretary
- Mr. Robert Abramowski
- Mr. Scott Heins
- Mr. David McCulloch
Pension Investment Policy and Objectives
Updated May 2012
The Pension Commission has a written statement of investment policy that is accepted by the Synodical Council of the Wisconsin Evangelical Lutheran Synod for the guidance of fiduciaries and investment management organizations employed to assist in investing and accumulating assets of the Wisconsin Evangelical Lutheran Synod Pension Plan ("the Plan "). Listed below are excerpts from the full statement.
Purpose of the Statement
The purpose of this Statement is fourfold:
- Set forth investment objectives, policies, and guidelines which are appropriate and prudent in consideration of the needs of the Plan.
- Establish criteria against which investment manager(s) retained by the Commission will be measured.
- Communicate investment objectives, guidelines and performance criteria to the investment manager(s).
- Guide the Commission's ongoing oversight of the investment of the Plan assets.
Role of the Commission
In adopting this Statement, the Commission recognizes its fiduciary responsibility to develop and monitor investment policy and objectives for the Plan solely in the interest of the Plan's beneficiaries.
To that end, in this statement the Commission adopts investment policy and objectives that are deemed most appropriate given the Plan's funding status, liability profile and need for short term liquidity.
The Commission is also responsible for the selection of investment managers, consultants and any other investment professionals required to execute and monitor the Plan's investment policies.
Asset Allocation Guidelines
In determining an appropriate asset allocation for the Plan, the Commission, in conjunction with an investment consultant, has evaluated the Plan's funding status, liability structure and projected benefit payment requirements.
As a result, the Commission has established asset allocation guidelines designed to achieve the target return objective while gaining the risk control benefit of diversification.
The guidelines are as follows:
| |
Minimum* |
Target |
Maximum* |
| |
|
|
|
| Equity |
|
|
|
| U.S. Large-Cap |
23% |
27% |
31% |
| U.S. Mid-Cap |
3% |
5% |
7% |
| U.S. Small-Cap |
3% |
5% |
7% |
| Non-U.S. Markets |
17% |
20% |
23% |
| Total Equity |
50% |
57% |
64% |
| |
|
|
|
| Fixed Income |
|
|
|
| Investment Grade |
12% |
15% |
18% |
| High Yield |
3% |
5% |
7% |
| Total Fixed Income |
15% |
20% |
25% |
| |
|
|
|
| Real Estate |
5% |
8% |
10% |
| |
|
|
|
| Hedge Fund of Funds |
10% |
12% |
14% |
| |
|
|
|
| Mezzanine Debt |
0% |
3% |
5% |
| |
|
|
|
| Total Portfolio |
|
100% |
|
* Note: Subtotals for Minimums and Maximums may not equal the sum of the corresponding minimums and maximums for the investment managers in the respective asset classes. Allocation targets, therefore, should be reviewed on both an individual investment manager portfolio level and an asset class level.
Rebalancing
The total portfolio and individual investment manager target allocations should be viewed as long term investment objectives. The Commission will review the asset allocation of the Plan on a quarterly basis, relative to the allocation target and ranges delineated in the policy. This review and consultation with the Plan's investment consultant may result in period re-balancing by the Commission to stay within the long-term objectives. When the Commission determines that rebalancing is appropriate, the Commission will endeavor to rebalance to the target allocations delineated in the policy.
It may also be necessary to periodically invest excess cash, held in the custodial cash account and invested daily, within the overall investment portfolio. The Commission will review the current cash balance on a quarterly basis and make a determination concerning the utilization of those funds.
Diversification
The Commission understands their responsibility to diversify the Plan's assets. Investing the Plan's assets in multiple asset classes and using outside investment managers with well-diversified portfolios, is done with the goal of insulating the portfolio from the effects of substantial losses in any single security, or sector of the market.
Review Process
On a periodic basis, but at least once per year, the Commission will:
- Review the actual results achieved to determine whether the investment consultant and the various investment managers recommended by the investment consultant have performed in accordance with the policy and the return objectives as set forth therein.
- Review the asset allocation guidelines and make any needed changes. The Commission retains an independent investment consultant to assist in the evaluation of the investment managers' performance relative to the objectives outlined in the policy.
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