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Global Retirement Trust

Global Retirement Trust

Background information

The GRT was established by the State Services Commission in 1992 (when the Government Superannuation Fund (GSF) closed to new members) to provide superannuation services to the state sector. Its core current business is the management of superannuation schemes initiated by individual government departments.

The GRT is a true mutual - an independent, not-for-profit, trust acting solely in the interests of members, independent of the Crown and with no government guarantee.

The GRT has a board of independent experienced trustees.

The GRT’s membership is made up of a number of employer-sponsored registered superannuation schemes, along with its multi-employer master trust scheme - the Employee Retirement Plan (ERP) and the Individual Retirement Plan (IRP). These are referred to as the GRT’s “Member Schemes”.

The GRT’s collective membership stands at over 23,000 individuals (approximately 97% state sector), with pooled retirement savings of over $420 million.

The GRT’s multi-employer master trust scheme Employee Retirement Plan (ERP) will be the vehicle for the new State Sector Scheme.

The GRT procures and manages for the ERP all its requirements for administration services and investment services under the terms of a membership agreement. The GRT has contracted master trust administration services for the ERP to Mercer Human Resource Consulting Limited (Mercer). This decision recognises Mercer’s financial security and excellence in superannuation administration, member education and communication services.

Both the GRT and Mercer are focused on offering and managing employment-based retirement savings schemes, and do not sell other products. There are no sales agents and no related cost structure.

In partnership with Mercer the GRT established, launched and promoted the ERP Teachers’ Scheme (launched in September 2002). This scheme (at the time covering teachers and principals in state, and state-integrated primary, intermediate and special schools) had an initial uptake of 30%. Membership is now over 7,400 and is still growing. It is now regarded as a template for the State Sector Retirement Savings Scheme.

The GRT manages and Mercer administers a number of other state sector superannuation schemes, such as the Police Superannuation Scheme.

The GRT and ERP Trustees are accountable to members. The ERP trusteeship reflects the current membership and potential membership from within the state sector. The ERP Trustees have voting rights at the GRT’s AGM and in the appointment of the GRT Trustees. The GRT Trustees are elected by the GRT’s members (the trustees of the schemes that are members of the GRT) and scheme voting rights are related to the value of funds invested in the GRT (proportionate to the number of units held or funds invested in the GRT).

The GRT contracts investment management, administration, financial advisory and insurance services to established, professional organisations that offer proven performance using a competitive independent tender and selection process.

GRT’s investment management style is based on the principle of “the best person for the job”. The GRT’s Investment Committee regularly reviews the managers’ people, processes and performance. It retains the ability to change investment managers at any time, or immediately if necessary. Key GRT People Trustees

John Irwin (Chairman) July 1995-

Hutton Peacock March 1992-

Graeme Pentecost May 1997- General Manager

Louise Gibson July 1995- Profiles

John Irwin – Chair of GRT Trustees & an ERP Trustee John has a long background in life assurance and superannuation. John was General Manager of the GRT for the first three years following its inception in 1992. Prior to that he was Marketing Manager for the AMP Society's Corporate Superannuation Division for two years. Until joining AMP, he spent thirty-two years with Royal Insurance and prior to that group moving out of the life assurance market in New Zealand, he managed its life company for eight years. In addition, he was Chairman of the Life Offices' Association in 1988. John is currently Chairman of the Wellington Archdiocese Catholic Development Fund, as well as the John Ilott Charitable Trust Advisory Committee.

Tim McGuinness – GRT Trustee & Investment Committee Member Tim McGuinness was approached to join the GRT's Investment Committee in March 2002 and then appointed a GRT Trustee in August 2003 because of his extensive investment knowledge and expertise and his past experience and involvement with a number of other boards and organisations. Tim also holds seats on both the Government Superannuation Fund (GSF) Board and the Earthquake Commission and is a member of the Market Surveillance Panel of the NZ Stock Exchange (appointed in November 2000). He previously held positions as General Manager and Group Investment Manager of the Norwich Union NZ Group and then as Director (Asset Management) and General Manager Investments for the Royal & SunAlliance Group in New Zealand up until mid 2000.

Hutton Peacock – GRT Trustee & Investment Committee Member Hutton Peacock is Chairman of the Remuneration Authority and a Consulting Actuary with Watson Wyatt. Hutton is also the independent trustee of the NZ Fire Service Superannuation Scheme, the Medical Assurance Staff Scheme and a Director of Trust House Limited. Previously, he was Chief Executive of Government Life/Tower Corporation from 1979 to 1990. He is also a past Chairman of the Life Offices' Association and a former President of the NZ Society of Actuaries. He brings a great deal of superannuation, actuarial and investment knowledge to the Global Retirement Trust.

Graeme Pentecost – GRT Trustee and Chair of Investment Committee Graeme Pentecost completed his term as Executive Director of Rangatira Ltd in 1999, but remains on the Rangatira Ltd Board. Graeme is currently a Director with the Polynesian Spa Ltd (Rotorua) and Te Kairanga Wines Ltd (Martinborough) and is the Chairman of trustees of the ACC Staff Superannuation Scheme (Shamrock Superannuation Ltd). He also recently completed a 3-year term as a Director of Tower Trust (now known as Trustees Executors). Previously, Graeme was Trust Bank NZ Ltd’s Managing Director, before retiring in November 1996 following the Westpac/Trust Bank merger. Before his time at Trust Bank, Graeme spent 32 years with the Bank of New Zealand. Graeme, therefore, brings extensive investment knowledge and expertise with him to his role as a Trustee of the Global Retirement Trust.

Louise Gibson - GRT General Manager Louise holds the position of GRT General Manager and as such is responsible for the overall management of the GRT operation. Louise has over 17 years experience in the financial services industry, with six of those years working for the AMP Society’s Group/Corporate Superannuation Division. Her background is in marketing and communications both at AMP and with Barclays Financial Services in London. Louise joined the GRT when it was first established in May 1992 and has now been with the GRT for nearly twelve years; three years as the Communications Manager and for the last nine years as the General Manager. ERP Trustees The ERP Trustees are appointed by the GRT Trustees to represent the ERP membership.

Beverley Wakem (Chair) April 2003-

John Irwin August 2002-

Alison Timms June 2003-

Ivan Hoshek June 2003-

Russell Ballard December 2003-

Rob Crozier December 2003- Profiles

Beverley Wakem – Chair Beverley is Deputy Chair of the Remuneration Authority, and Chair of the Insurance and Savings Ombudsman Commission. She also chairs the St James Theatre Charitable Trust, St James Theatre Limited and the Performing Arts Foundation of New Zealand. Beverley is a fellow of the NZIM, and an associate member of the Institute of Directors and sits on a number of Boards and Committees. Beverley has enjoyed a distinguished career in broadcasting culminating in her appointment as Chief Executive of Radio New Zealand in 1984 – a post she held until 1991. In 1991 Beverley was appointed Commercial Director for Wrightson Limited, and in 1992 she became General Manager, Human Resources and Corporate Affairs for the company. She was awarded a CBE in 1990 for her services to broadcasting and the community, and was also awarded the 1990 Commemoration Medal. Beverley brings considerable business experience and financial expertise to the Board of ERP Trustees.

Russell Ballard Russell recently retired from the public service. For the last 16 years he served as Chief Executive of four government departments – Ministry of Forestry, Department of Education, Ministry of Agriculture and Fisheries and Land Information New Zealand. He brings a wealth of knowledge of the public sector, its systems, structures, culture and governance arrangements. He is currently on a temporary assignment as Acting Chief Executive of the Department of Child, Youth and Family Services. Russell was awarded the 1990 Commemoration Medal and the Massey University 75th Anniversary Medal. He is a fellow of the NZIM and a member of the Institute of Directors. Russell also holds a Diploma in Company Direction from the UK Institute of Directors.

Rob Crozier Rob brings previous GRT experience to the Employee Retirement Plan as he was a Trustee of the New Zealand Universities’ Superannuation Scheme from 1994-2000. Rob is Deputy Chairman of Consumers’ Institute, a Director of PSIS and a member of the Weathertight Homes Resolution Service Advisory Board. Rob has been a member of the Ministry of Education’s Technical Working Group reporting on the Introduction of a Performance Element to Tertiary Education Funding. Rob was General Secretary of the Association of University Staff from 1979-2002 and acted as an advocate for university staff interests in relation to superannuation throughout that period.

Ivan Hoshek Ivan brings a great deal of superannuation, actuarial and investment knowledge to the Employee Retirement Plan. Ivan is a qualified actuary and has held chief actuarial positions in major life insurance companies over the last 20 years. Ivan has held the Chief Financial Officer role in three substantial life insurance companies, Royal and Sun Alliance (NZ) Ltd, NZI Life and Colonial Mutual. He has held responsibilities for actuarial, corporate superannuation, investment, financial reporting, accounting and ISD functions in major financial services companies in New Zealand. He has also provided tax and strategic and business planning advice for several life insurance companies. Ivan has been a member of various LOANZ, ISI and NZ Society of Actuaries committees, including past Treasurer of the New Zealand Society of Actuaries.

Alison Timms Alison Timms is a member of the NZ Parole Board, is Deputy Chair of Radio New Zealand, a member of the Casino Control Authority, and a volunteer worker for the Citizens’ Advice Bureau. Alison has had 20 years of senior management experience in the public sector covering the full range of general management responsibilities. Her most recent position was as Acting Chief Executive of the NZ Fire Service, a position she held from 1999 to 2001. She is now an independent consultant based in Wellington. She is a member of NZIM and the Institute of Directors. She was convener of the working party to establish the Global Retirement Trust in 1992 and has been a Trustee of the GRT’s Individual Retirement Plan since June 2001. Background information

Mercer is a limited liability company incorporated in New Zealand on 16 February 1971.

Mercer Human Resource Consulting, one of the world's leading consulting organisations, helps organisations create measurable business results through their people. With more than 13,000 employees serving clients from some 150 cities in 40 countries worldwide, the company is part of Mercer Inc., a wholly owned subsidiary of Marsh & McLennan Companies, Inc., which lists its stock (ticker symbol: MMC) on the New York, Chicago, Pacific, and London stock exchanges. More information can be found at www.mercerhr.co.nz

In New Zealand, Mercer is a leading provider of superannuation products and services to employees, employers and trustees. Mercer operates its New Zealand superannuation administration business from Wellington as part of an integrated regional Australian and New Zealand operation employing over 500 superannuation administration staff, all using the same administration systems and processes. Mercer also specialises in complementary people strategy services. Mercer assists employers to develop links between their people management, rewards systems, employee performance and business results.

After winning an extensive competitive tender conducted by the GRT Trustees and an independent consultant, Mercer was appointed to administer the GRT’s multi-employer master trust, the Employee Retirement Plan (ERP), in September 2002. This contract included the administration of the successful Teachers Retirement Savings Scheme.

For the provision of master trust services to the State Sector Retirement Savings Scheme, the GRT has chosen to partner with Mercer again to provide the additional services that naturally complement their already established administration services, which are currently provided to the ERP and the Teachers Retirement Savings Scheme. Key people at Mercer Head of Mercer, New Zealand

Tim Jenkins Profile

Tim Jenkins, Head of Mercer, New Zealand Tim is a Mercer Worldwide Partner and Executive Director of Mercer New Zealand. He has been working in the superannuation industry since joining Mercer UK in 1985. He is one of Mercer’s most experienced superannuation consultants. He was appointed Head of Mercer New Zealand in May 2002, transferring from Mercer Sydney office where he was Head of Retirement Consulting. His actuarial knowledge and his global perspective gained from working with Mercer internationally means that Tim is able to bring a depth of experience to any superannuation and benefits problem. Tim has a Bachelor of Arts Degree (Honours) in Economics. He is a Fellow of the Institute of Actuaries (London) and a Fellow of the Institute of Actuaries of

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