Instability at Alberta’s public pension fund could undermine its effectiveness
While 2020 was tough on just about everyone, the Alberta Investment Management Corporation (AIMCo) really took it on the chin. Alberta’s public pension fund manager lost billions of dollars in a volatility-based trading strategy during a topsy-turvy year in markets. The losses undermined public confidence in AIMCo, and the province’s Finance Minister Nate Horner recently dismissed AIMCo’s entire board, appointing a veteran public servant to serve as the organization’s interim CEO. The government of Alberta ostensibly intended to restore confidence in the fund, but the move might not have the desired effect, according to Sebastien Betermier, Associate Professor of Finance at ۲ݮƵ Desautels. “It’s a move against independence, and the ability to work at arm’s length from government,” Betermier tells CBC. The instability could also ultimately backfire, giving potential partners pause about working with AIMCo on projects with long-term investment horizons.