CPP Investments active equities division layoffs, Digi Mart USA News (Toronto, Canada): Canada Pension Plan Investment Board is laying off dozens of employees from its active equities division and will merge the department with another unit after several years of underperformance, two sources with knowledge of the decision said.
The cuts affect a large part of the department’s employees, though a smaller number of staff will stay on and some of the affected employees may find roles in other departments, the sources said. Frank Ieraci, a senior managing director who led the active equities division since 2020 and joined CPPIB in 2007, is among the employees departing, the sources said.
The Globe and Mail is not identifying the sources because they were not authorized to discuss internal CPPIB decisions.
The active equities strategy will be merged with CPPIB’s capital markets and factor investing division, which is led by senior managing director Heather Tobin. She will lead the combined unit.
CPPIB manages $864-billion of assets on behalf of more than 22 million working and retired Canadians who contribute to the Canada Pension Plan, and is the country’s largest pension fund. The active equities unit invests in public companies and those soon to be listed publicly, relying on proprietary research to make “high-conviction” bets on individual companies.
But the strategy has struggled for years. It lost $3.5-billion in CPPIB’s 2026 fiscal years, which ended March 31, and has lost a total of $6-billion over five years.
Over a 10-year span, the active equities division has earned only $1.9-billion in gains.
As of the end of CPPIB’s fiscal first quarter, which ended June 30, the active equities division had $36.8-billion of assets under management. Over the same 10-year period, CPPIB’s average annual return for the overall fund was 8.8 per cent.
The active equities strategy takes both long positions on companies the investment team believes are undervalued, and short positions on companies it expects will fall in value, aiming to profit from the difference in performance.
In the fund’s most recent annual report, CPPIB attributed the poor performance in part to losses incurred in the 2022 fiscal year after regulatory changes in China, which contributed to CPPIB’s decision to reduce its exposure to the country. In 2026, the active equities team’s long positions in stocks underperformed corresponding short positions in sectors such as financials and industrials, as well as media and telecommunications.
That was compounded by high volatility in markets, CPPIB said in its annual report.
