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WT/BFA/W/550  
 
11 May 2021  
(21-3957) Page: 1/4 
Committee on Budget, Finance and Administration   
 
UPDATE OF THE PENSION PLAN MAN AGEMENT BOARD ON  RECENT ACTIVITIES, 
DEVELOPMENTS AND CHALLENGES OVER THE PAST SEVERAL MONTHS  
 
1  WTO PENSION PLAN ACTIVITIES AND COVID -19 
1.1.  Working within the constraints caused by the on -going pandemic has posed some challenges 
to the completion of the Secretariat tasks. Nonetheless, with the experience acquired during the 
past year, procedures have been adjusted and the work is performed and  delivered seamlessly.  
1.2.  The External Audit was again conducted remotely due to COVID but completed as scheduled. 
Therefore, unlike last year, there should not be a delay in the release of the Financial Statements 
and the Annual Report. Some advance highlig hts from the 2020 Annual Report can be found in 
section 3 below.  
2  UPDATE ON THE MANAGEMENT BOARD  
2.1.  The triennial process of renewing terms of members of the Management Board was concluded 
last July. The new Board members are now fully engaged in their work f ollowing several regular 
Board meetings and introductory sessions dedicated to key topics like investments and actuarial 
valuations.  
2.2.  The current membership is as follows . 
 
3  HIGHLIGHTS FROM THE UPCOMING 2020 ANNUAL REPORT  
3.1.  The 2020 Annual Report is currently in its final drafting phase. It is scheduled to be released 
in the next couple of months after it has been presented to the General Council before the summer 
break.  
3.2.  Some extracts of key figures and charts that will be included in the report can be found below 
so you do not have to wait for the fully audited report.  Mr. Jean -Marc van Dril, Chairperson  
Mr. Robert Cook  
Members elected 
by the General 
Council  Ms. Antonia Carzaniga  
Members appointed 
by the Director -
General  Ms. Alicia Goujon  Mr. Christian Dahoui  
Mr. Conor Harrington  Mr. Rainer Lanz  
Ms. Darija Sinjeri  Mr. Thomas Verbeet  
Ms. Wei -Ting Chiu  
Alternates elected 
by the General 
Council  Ms. Kerry Allbeury  
Alternates appointed 
by the Director -
General  Mr. Loudon Mattiya  Ms. Laura Monnet  
Mr. Rodolfo Rivas  Ms. Nthisana Phillips  
Ms. Chiara Santangelo  Ms. Zheng Wang  
Mr. Robert Luther  Observer on behalf of the beneficiaries  
Mr. Paul Rolian  Alternate observer on behalf of the beneficiaries  WT/BFA/W/550  
 
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  3.1  Evolution of the Pens ion Plan Demographics  
3.3.  The number of participants has remained largely stable. On 31 December 2020, there were 
709 participants, as compared to 718 on 31 December 2019. On the other hand, the number of 
beneficiaries is steadily growing and increased from 39 3 to 408 over the same period.  
Figure 1 Demographics  
 
 
3.2  Investment Returns  
3.4.  The Management Board's investment strategy exceeded its long -term target return of 3.5% by 
delivering a nominal return of 4.2% (versus 6.1% for the benchmark). The underperformance 
relative to the benchmark is almost exclusively related to the real estate portion of the portfolio 
where the unique nature of underlying assets makes it hard to benchmark closely. The real estate 
holdings of the Plan have performed in line with the expected long -term yields for this asset class. 
As Swiss inflation for 2020 was close to -0.8%, the portfolio's real return was 5.0% for the year. 
This is well above the target rate of return. Except for global real estate invest ments, all investment 
categories performed in line with their benchmarks and generated positive returns for the year.  
3.5.  The COVID -19 crisis created significant volatility in the first quarter. The systematic rebalancing 
enabled the portfolio to benefit from price fluctuations and acquire assets at lower prices.  
3.6.  While financial returns were generally positive in 2020, economic fundamentals deteriorated  
due to COVID -19. Global corporate earnings fell more than 20% and dividends declined around 15%. 
Default rate s and bankruptcies increased, and real estate investments saw vacancies increase and 
rents weaken.  
3.7.  The Board made important investment decisions, such as revising the Plan's strategic asset 
allocation to include 50% equities, 30% fixed -income and 20% real estate.  In order to meet the 
Plan's return needs, the Board indeed decided to increase the portfolio share of equities from 40% 
to 50%. The relatively favourable cash -flow profile combined with lower asset prices due to the 
COVID  crisis supported this deci sion. Furthermore , the Board changed three investment vehicles 
and introduced an additional rule for rebalancing. The decisions were followed by revising the Plan's 
Investment Guidelines accordingly.  
 
 
 
 
 
 
 
WT/BFA/W/550  
 
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  Figure 2 Real rate of re turn: best, worst, and last 7 years. Dashed line represents long 
term target return rate  
 
 
Table 1 Assets and Investments as of 31 December 2020  
Assets and Investments as of 31 December 2020  
Asset Category  Million CHF  Strategic Allocation  Actual Allocation *  
Global Equities  347.2  50.0%  52.4%  
Bonds and Cash  163.8  25.0%  24.7%  
Real Estate  119.5  20.0%  18.1%  
Other Investments  31.5 5.0%  4.8%  
Total 662.0  100%  100%  
* The portfolio is rebalanced to it strategic allocation in the first quarter of each new year.  
Note: figures may not add up due to rounding  
 
4  NEW CONSULTING ACTUARY  
4.1.  As reported to this committee previously, the Board was informed that Mercer, its actuarial 
service provider, had unexpectedly terminated the employment of the Plan's lead actuary. The Board 
decided to end the contract with Mercer and launch a procurement exercise which has just recently 
been completed.  
4.2.  Upon the WTOPP Management Board recommendation, the Director General has appointed 
(effective in late April) the company c-alm as the new Consulting Actuary to the WTO Pension Plan.  
This followed a competi tive Request for Proposals (RfP) exercise with the support of the WTO 
Procurement Section. C -alm's proposal was evaluated as technically excellent and the interviews 
with the lead actuary confirmed this impression.  Combined with their attractive financial  bid, they 
were a clear best choice and value for money option.  
4.3.  C-alm, which stands for "Comprehensive Asset Liability Management ", is an independent 
Swiss -based consulting firm for pension funds, insurance companies and other enterprises. This 
company was  founded as a spin -off of the University of St. Gallen.  
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  4.4.  The transition to the new actuary was unexpected and disrupted the normal cycle of actuarial 
work. As a result, the regular actuarial reporting from the WTOPP will be delayed until at least the 
end o f this year.  
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