March 2021 Edition

Since last March, we've faced many socioeconomic challenges. And Desjardins continues to listen to local communities, from coast to coast, and responds by saying, "We’re here for you."

At Desjardins, we believe that socioeconomic recovery can be done locally and in a sustainable manner. That's why we've decided to support small businesses across the country through the GoodSpark Small Business Grants Program External link. Opens in a new window.. Launched on January 27, this initiative provides $10,000 grants to 75 locally owned and operated small businesses, some of which will also receive advertising support and customized business consulting services from MBA students at York University's Schulich School of Business. As a result of our many initiatives, Desjardins is proud to be 1 of 3 financial institutions in North America recognized by the United Nations as a responsible institution during the COVID‐19 pandemic.

With our experts from the Desjardins Economic Studies team, we're always in tune with the most recent economic developments. That's why last fall, in collaboration with the Fédération des chambres de commerce du Québec, we met with entrepreneurs in every region of Quebec to present regional portraits of the socioeconomic recovery External link. Opens in a new window. (in French only). These studies are available to everyone at no cost.

To find out more about the economic situation—not only in Canada but around the world—you can subscribe External link. Opens in a new window. to receive our economic studies.

With Omni, the all-in-one mobile app for Desjardins group benefits and retirement savings, your plan members now have everything they need to track their retirement savings anytime, anywhere.

Introduce them to Omni with a contest that can give them a chance to win $1,000.

To enter

To be automatically entered in the contest, your plan members will just need to log in to their group retirement savings account via Omni Desjardins, our mobile app, between April 6 and June 6, 2021.

4 prizes of $1,000

Plan members will have a chance to win 1 of 4 cash prizes of $1,000. Winners can have the money deposited into their group retirement savings plan1 or paid out to them directly. To select the 4 winners, 2 draws will be held on May 11, 2021, and 2 draws will be held on June 9, 2021.

On April 6, your plan members will receive an email inviting them to enter the contest and watch a short video featuring Omni’s many advantages.

You can print out these posters or upload them to your intranet to promote the contest to your employees:

8.5 x 11 poster (PDF, 3.3 MB) External link. Opens in a new window.

11 x 17 poster (PDF, 3.3 MB) External link. Opens in a new window.

To learn more, read the full contest rules External link. Opens in a new window. (PDF, 228 KB).

We’re pleased to share with you our new onboarding material that reflects our human, modern and inspiring Bring your dreams to life approach. With this material, we want to create a simpler and more meaningful plan member experience—thanks to more streamlined content and a focus on financial wellness. This new material better supports and engages plan members and shows the value of their group retirement savings program. It also introduces the concept of having non-retirement goals.

To support our digital shift, we offer PDF versions with embedded hyperlinks, including one to download Omni, our new mobile app. While we’re encouraging the digital experience, we still offer 100% recycled paper kits.

Main differences between existing and new kits

1. No need for a folder: The new guide includes an inside pocket where key documents are inserted.
2. The kits are lighter: There are fewer documents, and the new streamlined guide has only 6 pages instead of 18.
3. Penny, our virtual guide: Penny has been strategically positioned throughout the guides to provide relevant tips.
4. Omni is everywhere! We’ve integrated Omni, our new mobile app, so that plan members will learn how to download it and access their group retirement savings account from the mobile device of their choice.

New enrolment flyer

We also have a new enrolment flyer that you can use to gently remind your employees to enrol in their new plan or create their account to access our online services. Like the guides, they contain links to download Omni or go directly to the plan member site via dfs.ca/GroupPlanMember, where they can create or log on to their account.

Accessibility—one more step towards inclusion

The PDF versions of our enrolment guide and flyer are accessible. This means that the documents are accessible to people who use magnification software, or a text-to-speech or braille screen reader.

Availability of new materials

The enrolment flyer, and both paper and PDF versions of the kit are available to all our groups. You can request them by contacting your client relationship manager. You can use up the old paper kits before ordering the new ones.

Enrolment flyer

A pre‐authorized debit (PAD) allows Desjardins to withdraw the total amount of employee contributions to be deposited to the plan, directly from your company's bank account.

Why should you change your current method to PAD?

Because it's quick, easy and reliable. With PAD, the exact amount is withdrawn from your account when you send us your contribution list. You no longer have the extra step of sending in the contributions by cheque, e‐transfer or online payment. The two steps of your contribution remittance are combined into one. Furthermore, your payment and the contribution total will always balance.

Not sure about having Desjardins make withdrawals directly from your bank account?

You control when the withdrawals are made and how much is withdrawn, since the PAD is triggered only when you send in the contribution list. It's important to note that PAD doesn't permit any other types of transactions to be carried out in your account.

How do you sign up?

Simply fill out the PAD for businesses form, available on the Plan sponsor website. Go to dfs.ca/plansponsor, click Log on and then Group retirement savings. Enter your user ID and password, and then from the home page, go to the Forms section. You can also get the form by calling Plan Sponsor Services at 1‐888‐510‐4762 or by emailing us at grs_plansponsor@dfs.ca.

The Canada Revenue Agency (CRA) requires all employers who sponsor a registered pension plan (RPP)2 to file a T1007 – Connected Person Information Return External link. Opens in a new window. within 60 days of a connected person becoming a member of the RPP. To find out what you need to do, read the Employer Instructions section on the T1007 return.

The T1007 late filing penalty is $25 per day, for up to a maximum of 100 days.

A connected person3 is someone who meets one or more of the following conditions:

She/he owns (or is deemed to own), directly or indirectly, at least 10% of the issued shares of any class of the capital stock of the employer, or of any other corporation that is related to the employer.

She/he doesn’t deal at arm's length with the employer. It includes people like the employer's majority shareholder, and anyone related to the majority shareholder–like a spouse, child, sibling, parent or in-law.

She/he is deemed to be a specified shareholder of the employer under paragraph (d) of the definition of "specified shareholder" in subsection 248(1) of the Income Tax Act.

A person is deemed to own all or a part, depending on the situation, of the company shares that belong to:

• Another person who does not deal with her/him at arm’s length (such as the spouse, child, sibling, parent, in-law)
• A trust for which she/he is the beneficiary
• A partnership to which she/he is a member

Important: This is not an exhaustive list of definitions. For advice on your specific situation, please speak to your tax specialist.

On December 14, the Government of Newfoundland and Labrador amended its Pension Benefits Act, 1997 External link. Opens in a new window. to allow holders of locked-in retirement accounts (LIRAs), life income funds (LIFs) and retirement income funds (LRIFs) of this province to submit a request to unlock a portion of their locked‐in retirement savings arrangements, particularly in the event of financial hardship. Financial hardship is defined as the following:

• Threat of foreclosure due to inability to make monthly mortgage payment;
• Threat of eviction due to inability to make rent payment;
• Inability to make first month's rent or security deposit when trying to rent accommodations;
• Inability to pay for medical costs;
• Inability to pay costs related to equipment or treatment related to a disability;
• Reasons of low income where income does not exceed 66.66% of the YMPE; or
• Non residency for at least 2 consecutive years.

This legislative change is effective March 1, 2021. We'll share more details about this topic in a future issue of The Essential.

As part of its good governance practices, Desjardins Insurance will be withdrawing the following funds from its group retirement savings platform on April 23, 2021:

• 316 – CI Signature Canadian Balanced
• 289 – Desjardins Canadian Bond (DGIA)
• 380 – Vanguard Global Fixed Income Index
• 343 – Desjardins Canadian Equity Income (DGIA)
• 330 – CI Cambridge Canadian Equity
• 238 – Triasima Canadian All Cap Equity
• 246 – MFS U.S. Equity
• 278 – Hexavest Global Equities
• 236 – Hexavest Global Equities Hedged

Plan members and sponsors affected by these changes should already have received a communication that includes information about the replacement fund established for each of the withdrawn funds.

When deciding on whether to maintain a specific fund on the platform, different factors are considered, like compliance with qualitative and quantitative fund governance criteria, the level of interest in the fund, and the fund's competitiveness against comparable investment options.

For more information about these changes, feel free to contact your client relationship manager.

On March 15, 2021, Desjardins Insurance made changes to the following fund names to better identify their eligibility for different types of savings vehicles:

• The DFS BlackRock^© U.S. Equity Index Fund was renamed DFS BlackRock^© U.S. Equity Index (Registered Only) Fund
• The DFS BlackRock^© U.S. Equity Index Hedged Fund was renamed DFS BlackRock^© U.S. Equity Index Hedged (Registered Only) Fund
• The DFS BlackRock^© U.S. Equity Index (Non-Registered) Fund was renamed DFS BlackRock^© U.S. Equity Index Fund

The first 2 funds are only available to registered pension plans and non-profit organizations, while the last fund is available for all types of savings vehicles.

For more information about this change, feel free to contact your client relationship manager.

BlackRock^© is a registered trademark of BlackRock, Inc. Used under licence.

On April 23, 2021, Desjardins Insurance will be modifying the structure of the investments held in the DGIA Emerging Markets Fund offered on its group retirement savings platform. On that date, units of the DGIA fund in which the DFS fund is invested will be replaced by holdings with four external managers. This new structure is designed to maintain the DGIA fund's multi‐manager and diversified approach, while reducing its associated costs. Following these changes, the fund will be renamed Multi-Manager Emerging Markets Fund, and its regular investment fees will be reduced.

Two external managers that will be part of the new structure are currently sub-managers of this fund: Baillie Gifford and Comgest. Two new managers, Mondrian and T. Rowe Price, will round out the structure to ensure that the different investment approaches are really complementing each other. The new structure will be comprised of these specific strategies:

• Baillie Gifford: Emerging Markets All Cap
• Comgest: Global Emerging Markets Equity (through the Desjardins SocieTerra Emerging Markets Equity Fund)
• Mondrian: Emerging Markets Equity
• T. Rowe Price: Emerging Markets Discovery Equity

For more information about these changes, feel free to contact your client relationship manager.

As part of the periodic review of our Multi‐Management Funds, we will be making changes to their composition, effective March 31, 2021. These modifications are in line with our management philosophy for Multi Management Funds, which aims to optimize the long‐term expected return for a given risk level.

The main changes are detailed as follows:

• There will be a change in how the funds in the foreign large cap equity component are allocated in order to achieve optimal asset allocation. This change includes replacing the Acadian Global Managed Volatility Equity Fund with the Mondrian Global Equity Fund.
• The Vanguard Global Fixed Income Index Fund will be removed from the foreign bond component, and its allocation will be reattributed to the Desjardins Global Bond (PGIM) Fund, in order to increase this component's value added potential.

Minor changes will also be made to the funds' asset allocation to reflect the annual strategic asset allocation review.

The modifications will not change the pricing.

For more information about this change, feel free to contact your client relationship manager.

On April 23, 2021, Desjardins Insurance will change the underlying investment in its Fidelity True North Fund (current name), which is available on its group retirement savings platform. The fund's new underlying strategy will become the Fidelity Canadian Core Equity strategy, and the fund will use that name going forward.

The fund's objective will essentially remain the same: to provide a return that's mainly derived from long‐term capital appreciation by investing exclusively in a diversified portfolio of shares of all Canadian corporations. Going forward, no foreign securities will be held in this fund. The new strategy will focus on adding value through individual stock selection, while maintaining similar style and sector allocation as the benchmark.

This change aims to provide a strategy that's better suited for the institutional market. It will also reduce the fund's investment fee.

For more information about this change, feel free to contact your client relationship manager.

On January 27, 2021, Epoch informed us that David Pearl, a co-chief investment officer and co-founder, will retire on June 30, 2021. Bill Priest, Bill Booth, and Mike Welhoelter will continue to lead the investment team as co-chief investment officers.

On February 8, 2021, DGIA announced Marie-Claude DesRoches’ change of position within the Fixed Income team. Ms. DesRoches is now the acting Director of the Fixed Income team and her responsibilities include the credit analysis and portfolio management. As a result of this change, Ms. DesRoches is now leading the new Fixed Income department.

DGIA also appointed Frédéric Angers as Senior Director, Infrastructure Investments as of January 22, 2021.