Episode summary
From Scratch: Aaron Bennett on building a resilient pension plan without a playbook
Summary
Aaron Bennett described how the University Pension Plan was built from scratch in 2021 around one central goal: long-term pension security. He said the team focused on durable governance, disciplined risk management, liquidity, and a coherent target asset mix rather than chasing short-term returns. That approach was tested immediately in a volatile market, but UPP still preserved a funded status above 100% in 2022 and later reported a 10.3% annual net return in 2025 with assets reaching $12.8 billion.
Bennett argued that the advantage of launching a new fund was the chance to embed responsible investing, climate analysis, and governance into the process from day one. He framed responsible investing as “about value, not values,” saying ESG factors are integrated because they affect long-term risk and return. He also pointed to creative portfolio responses, including replicating inflation-linked bond exposure after the Canadian federal government stopped issuing real return bonds.
Looking ahead, he said scale will create more opportunity, but only if UPP keeps investing in talent, systems, data, and asset-liability modeling. He emphasized that communication with members is part of the strategy, especially in volatile markets, because trust is itself an asset.
Key takeaways
- Aaron Bennett said UPP was designed from day one around long-term pension security, not short-term performance chasing.
- He credited early discipline on liquidity, diversification, and governance with helping UPP navigate volatile markets.
- Bennett said responsible investing at UPP is an integrated part of portfolio construction, “about value, not values.”
- When Canada stopped issuing real return bonds, he said UPP reworked its inflation protection approach and found private-market substitutes.
- Bennett said the next phase of growth depends on more talent, better systems, stronger data, and tighter risk oversight.
Notable quotes
“From day one, we built for long-term resilience that shaped how we diversify, how we manage liquidity, how we determine our approach to governance and risk oversight”
“The objective was all about long-term pension security, responsible risk management, and building something that can endure”
“Volatility didn't change our destination of long-term pension security, but it did help shape our path and reinforce the discipline early on that we brought to the implementation of our strategy”
“For us, this is about value, not values”
“Scale brings opportunities such as broader access, the opportunity to selectively internalize certain aspects of what we do, access to more sophisticated strategies, and deeper partnerships”
How the episode opens
How do you build a brand new pension investment strategy with no track record at a time when markets are swinging wildly and every decision will affect members decades into the future? That's the environment Aaron Bennett stepped into when he joined the university pension plan as its inaugural chief investment officer in September 2021. Since then, UPP's portfolio has delivered remarkable results.
In 2022, during one of the most volatile market periods in recent history, the plan maintained a healthy funded status of 103.3% and outperformed the median defined benefit pension plan by roughly 3.3%. At the same time, the team built a sophisticated risk analysis framework alongside a comprehensive integrated climate and responsible investing approach. By 2025, UPP reported a 10.3% annual net return, growing the assets to 12.8 billion.
It's safe to say Aaron and his team have built and scaled a disciplined investment approach in a very short period of time. In recognition of that work, Aaron is the recipient of Markets Group's 2026 strategy award. Welcome to the Allocators playbook.
My next guest is Aaron Bennett, UPP's chief investment officer. Aaron, thank you so much for joining me today.
Thank you, Lauren. It's uh it's always an honor to be recognized and uh this really reflects the work of our exceptional team at UP and the support from our strong board and and sponsors. From day one, the focus has been on building something durable for members grounded in long-term thinking and disciplined risk management. I am truly proud of the progress we have made and and grateful to be part of that journey.
So Erin, when you joined UPP, what gaps or opportunities in the pension landscape stood out to you and how did they influence the way you shaped UPP's investment strategy?
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- pension planning
- risk-aware investing
- investment strategy
- market volatility
- fund performance
Companies and tickers mentioned
- University Pension Plan
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
More from Markets Group
-
The €3bn German Allocator Who Said No to Alternatives -
RE West 2026: Valerie Red Horse Mohl of the California Endowment Spoke to Courtney McQuade -
RE West 2026: Steve Biggs of The Mather Group Spoke to Courtney McQuade -
RE West 2026: Martha Delgado of Saint Francis Foundation Spoke to Courtney McQuade -
Two Stints as Interim CIO: Howard Hodel on Risk, Rebalancing and Reassuring the Board -
Stefan Beiner on Repo, Resilience, and Why Governance Beats Prediction in Pension Investing
Markets Group, this episode and its artwork belong to their owners. Octagon is not affiliated with the show; this page is an independent summary.
