Culture risk management can be enhanced within existing risk management frameworks, says the Canadian Institute of Actuaries, adding it doesn’t see a need for a separate guideline from the Office of the Superintendent of Financial Institutions.
In an open letter responding to the OSFI’s consultation, the CIA said it wants a better understanding of any specific issues the OSFI feels need to be addressed through the proposed guideline.
The CIA also noted smaller pension plans — both defined benefit and defined contribution plans — typically outsource activities such as administration, investments, actuarial valuations and risk reporting to third parties. In this situation, culture risk management relates to how the plan is governed and how third parties are selected and monitored, said the letter.
“Decision-making by the sponsor/administrator would be influenced by the sponsoring organization’s culture. As a result, most of the principles outlined in OSFI’s letter don’t apply to the pension plan itself, but rather to the sponsoring organization.”