A high-stakes governance crisis is unfolding at the CAAT Pension Plan, with shocking revelations and a web of controversies. But who's to blame? And what's the impact on members' retirement security?
CAAT chair Don Smith's removal: The drama began with the suspension and subsequent removal of Don Smith, the chair of the CAAT Pension Plan board of directors. This decision was made by the OPSEU members of the Plan's sponsors' committee, who appointed Smith as a trustee.
The scandal's origins: It all started with two controversial matters involving CEO Derek Dobson. First, a romantic relationship with an employee, disclosed in November 2024, which the board sanctioned. Second, a $1.6 million payment to Dobson in lieu of vacation time, approved by the board last year. These decisions sparked concerns among several executives, who ultimately resigned en masse.
OPSEU's response: The Ontario Public Service Employees Union (OPSEU), a key sponsor of CAAT, took swift action. They suspended Smith pending an internal investigation and called for an external probe into vice-chair Kareen Stangherlin, appointed by the College Employer Council (CEC). OPSEU emphasized its limited direct influence on CAAT's administrative decision-making, stating that it is 'seeking accountability' within its scope.
Internal investigation and accountability: OPSEU's internal investigation into Smith's actions is ongoing, focusing on allegations that he and Stangherlin may have acted outside the plan's policies and procedures. The union is calling for CEC to investigate Stangherlin's actions as well.
Board's response: The CAAT board of trustees has initiated a review of the pension plan's governance policies, procedures, and practices, led by an independent expert. This review is nearing completion, and the board is committed to continuous improvement and adherence to best practices.
Financial stability: Amid the turmoil, the CAAT Pension Plan remains financially robust, with $23.3 billion in assets under management as of 2024. It ranks among Canada's best-funded and highest-performing pension plans, with a strong funding health indicator of $1.24 for every $1 promised in benefits.
But here's where it gets controversial: Should the board have sanctioned Dobson's relationship and approved the substantial payment? And what role should sponsors like OPSEU play in holding the board accountable? These questions are at the heart of the ongoing debate. Share your thoughts in the comments below: Is this a case of necessary oversight or an overreach of power?
