President, K.P.A. Advisory Services Ltd., Toronto
Co-founder, Cost Effectiveness Measurement Inc., Toronto
in relation to their liabilities, and compare the results against other pension funds.
"What gets measured gets managed," said Mr. Ambachtsheer in a recent interview.
CEMS began with 50 pension fund clients and now has 300, including some of the largest pension funds in the world, with total assets of $2.3 trillion.
Mr. Ambachtsheer started his career with Sun Life Insurance Co. in Montreal, analyzing the new investment theories. In 1972, he joined Canavest House, a Canadian brokerage firm that packaged portfolio theory and sold it to money managers. In the late 1970s, Mr. Ambachtsheer met Don Ezra, an actuary in Toronto. "I wanted to switch from investments-only to broader pensions questions," said Mr. Ambachtsheer. With Mr. Ezra serving as the "liability guy" and with himself as the "investment guy" they put together a business — Pension Finance Associates — in which "we said pension plans should be managed as financial businesses focusing on the balance sheet, which includes assets and liabilities," according to Mr. Ambachtsheer.
Mr. Ambachtsheer published "Pension Funds and the Bottom Line" in 1985, which reiterated that belief. Also that year, he started K.P.A. Advisory Services.
"Keith really digs down to the bedrock pension issues," said John MacNaughton, CEO of the Canada Pension Plan Investment Board, Toronto. "He challenges conventional thinking, and he draws people to new levels of understanding."