Rescuing a Canadian Private DB Plan (2017)
MIPC 2017 Case
A lumber company in British Columbia runs a heavily underfunded pension plan. The managers of the plan’s fund face pressure from shareholders who want to limit cash outflows from the company into the plan, the government that imposes strict solvency regulations, and beneficiaries of the plan who rely on their pension for their retirement. The case highlights how the asymmetric treatment of the fund’s shortfall and surplus can lead to conflicting interests among stakeholders.