April 15, 2020
Chair of the firm’s Pensions and Employment practice Mitch Frazer told the Canadian Investment Review that pension plans looking to contribute financially to a charitable cause in turbulent times will have to consider what the cause is to determine the donation’s validity.
Mitch’s comments come in an article that discusses some of the issues Canadian pensions funds must keep in mind when deciding whether to donate towards coronavirus relief in a bid to help those in need.
“Is it doing something that supports someone’s school or educational initiative? Maybe that doesn’t fall in that category,” Mitch said.
“If it’s a COVID-19 relief fund, which helps save lives of potential members or the beneficiaries, or makes society better, or helps cure this and then helps the market, I think you have a much better argument.”
He also mentions the current situation isn’t like a traditional recession, like the global financial crisis, where pension funds gave back to companies in order to help prop them up.
“They were helping the economy because they had money to do so. But now an elephant—a.k.a., the government—has sat on the economy,” he said.
“And so, in order to get the elephant off the economy, you have to fix health. I would argue that a pension fund doing it within reason here is helping to fix a symptom of what is suspending our economy.”
Learn more about our Pension and Employment work on the relevant practice page.