Wilson stresses need for global thinking

Insurers should adjust their investment strategies in the face of an increasingly global marketplace, former federal cabinet minister and Brinson Canada Co. CEO Michael Wilson told attendees at a recent meeting of Canadian Insurance Accountants Association. Canadian p&c companies have traditionally invested 80% in fixed income and 20% in Canadian and foreign equities, but “this industry is going to be moving away from the ‘plain vanilla’ [investments] that we’ve had”, he predicts. Diversifying portfolios by sector or asset class rather than geography, declining transaction costs, increasing regulatory transparency and the availability of borderless, non-stop trading via the Internet are among the trends shaping investing in the new global economy. Wilson says the Canadian market has been slowed by foreign investment rules. “As an investment professional I have to recognize the serious limitations of the Canadian market.” In the case of both individual and corporate investors, he says, “rather than merely crossing borders, they’re ignoring them”.