The CAAT pension plan, which serves Ontario’s colleges and more than 800 public- and private-sector employers, has seen most of its senior leadership change in recent weeks.Merle Robillard/The Globe and Mail
The CAAT Pension Plan has placed chief executive officer Derek Dobson on administrative leave, installed an acting CEO and appointed a new chair and vice-chair to its board of trustees as a governance crisis at the $23-billion pension plan has spurred an overhaul of its leadership.
Mr. Dobson is being sidelined, effective immediately, after some of the plan’s top executives raised concerns about his conduct as well as oversight by CAAT’s board of trustees, setting off multiple investigations into possible governance failures.
Kevin Fahey, who was promoted to chief investment officer in late January, has been appointed as CAAT’s acting CEO and plan manager, CAAT said in a statement on Friday.
The pension plan also named trustee Audrey Wubbenhorst as its new board chair, and Janet Greenwood as vice-chair.
Previous board chair Don Smith was removed from his role earlier this month by the labour group that appointed him, the Ontario Public Service Employees Union (OPSEU), days after The Globe and Mail reported that concerns about board oversight and decision-making had spurred investigations into the plan’s governance.
Kareen Stangherlin, the previous vice-chair, has resigned as a CAAT trustee, the pension plan said Friday.
“The CAAT board of trustees has determined that these changes are in the best interests of the plan and are necessary to restore stakeholder trust in CAAT’s leadership, governance and plan management,” Ms. Wubbenhorst said in a statement.
She added that Mr. Fahey is “a veteran CAAT executive” who has worked at the plan for more than 16 years and is well suited “to lead the organization through the current period of significant change.”
As recently as last week, a CAAT spokesperson said the pension plan’s board of trustees continued “to have confidence” in Mr. Dobson and his ability to lead the organization.
But CAAT’s board met on Wednesday evening, two sources said, setting in motion the latest changes to the pension plan’s leadership.
The Globe is not identifying the sources because they are not authorized to discuss internal matters.
CAAT is a multiemployer pension plan that serves Ontario’s colleges and more than 800 public- and private-sector employers. It has a total of about 125,000 members. The Globe has been a participating employer in CAAT since 2022.
Mr. Dobson had been CAAT’s CEO since 2009, and faced scrutiny over a $1.6-million vacation payment he received last year that was at odds with company policy, as well as the handling of a personal relationship he had been having with a CAAT employee for more than a year.
The vacation payout, made as compensation for unused time off, was the third such payment Mr. Dobson received over a period of several years, sources said. The board approved those payments despite internal guidelines that limit how much vacation time CAAT employees can carry over or have paid out.
CAAT’s board also allowed Mr. Dobson’s workplace relationship to continue, putting guardrails in place to try to prevent perceived conflicts of interest, but it remained a point of tension among the plan’s staff.
An external expert hired by CAAT in December has been conducting a governance review that is expected to be completed later in February.
“The governance-related issues subject to the review do not affect the Plan’s financial health or its ability to deliver secure, predictable pensions to members,” CAAT’s statement said.
The most recent financial disclosures for CAAT said the plan has a 124-per-cent funded status, meaning that it has $1.24 in assets for every dollar it expects to pay to members in pension benefits.
The Financial Services Regulatory Authority of Ontario – which oversees the province’s pension plans – has also been probing what took place at CAAT and speaking with employees in recent weeks, two sources said.
With Mr. Dobson on leave, nearly all of CAAT’s senior leadership team has changed or left the plan over the past four weeks, leaving a leadership void that must now be filled by a board that has also come under pressure.
It has been a jarring period for CAAT, as Mr. Dobson has been the public face of the plan through a period of ambitious expansion that brought employers from a number of different industries on board. Morale at the plan has taken a major hit as long-tenured, senior leaders departed with little explanation, four sources said.
“We have gone through a lot recently, and many CAATsters have been understandably upset by it all,” CAAT said in an internal e-mail to employees on Friday. “The board determined the best way to restore stability was through this change.”
The turmoil at CAAT first came to a head internally in November, when three of the pension plan’s top executives approached the board with a number of concerns about governance, urging trustees to investigate them, multiple sources said.
The internal tensions only spilled into public view in January when those three executives – chief investment officer Asif Haque, chief financial officer Mike Dawson and chief pension officer Evan Howard – abruptly left the plan on Jan. 19.
CAAT promoted Mr. Fahey to CIO and appointed Scott Blakey, who had only recently stepped down from CAAT’s board, as interim executive vice-president and chief people and culture officer. Chief strategy officer Jillian Kennedy remained in place.