January 2021

26Jan

ECB considers going greener in staff pension fund

The European Central Bank is considering moving to the use of low-carbon benchmark indexes for fixed-income allocations within its staff pension fund. The Frankfurt-based ECB last year replaced all conventional equity benchmark indexes tracked by the pension fund with low-carbon equivalents. The fund has €1.3 billion ($1.6 billion) in assets and €2.5 billion in obligations. A spokeswoman said the size of individual allocations are not being disclosed. The move "significantly reduced the carbon footprint of the equity funds. The...

January 26, 2021
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04Jan

There is no escape from late retirement

European countries face the challenge of the economic and social consequences of an aging population. In particular, pension systems have to adapt to the changes taking place, maintaining, on the one hand, the financial stability related to the balancing of contributions receipts and pension expenditure, and at the same time the adequacy of benefits related to the protection of pensioners from poverty and the provision of an adequate income after leaving employment. One of the key instruments...

January 4, 2021
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December 2020

23Dec

Financial Incentives and Heterogeneity in Retirement Behavior An Empirical Analysis Based on SHARE-RV Data

By Nicolas Goll, Felizia Hanemann Over the past few decades, different reforms have come into force, which aim at keeping older workers in the labor market longer. Broad literature to date has investigated reform effects for the average worker. Evidence on the heterogeneous reform effects on different groups is to date however relatively sparse. We therefore evaluate the 1992 pension reform in Germany, which gradually introduced actuarial deductions for early retirement between 1997 and 2004. We investigate whether individuals...

December 23, 2020
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18Dec

Perspectives and Theories of Social Innovation for Ageing Population

By Andrzej Klimczuk, Łukasz Tomczyk In recent years we may observe increasing interest in the development of social innovation both regarding theory as well as the practice of responding to social problems and challenges. One of the crucial challenges at the beginning of the 21st century is population ageing. Various new and innovative initiatives, programs, schemes, and projects to respond to negative consequences of this demographic process are emerging around the world. However, social theories related to ageing are...

December 18, 2020
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02Dec

Europe’s ‘Ambitious Plans’ for ESG Disclosure Rules

New European rules on sustainability disclosure requirements in the financial services sector take effect in March, affecting institutions such as banks, insurance companies, pension funds, and investment firms. And while details of the Sustainable Finance Disclosure Regulation (SFDR) have not been finalized, law firm Akin Gump says the move to increase requirements shows the EU and the UK have “ambitious plans” for improving environmental, social, and governance (ESG) disclosures for financial firms. In 2018, the European Commission established an...

December 2, 2020
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November 2020

10Nov

Risk Dashboard: European insurers slightly less exposed to risks compared to the beginning of COVID-19 outbreak but concerns remain

Today the European Insurance and Occupational Pensions Authority (EIOPA) published its updated Risk Dashboard based on the second quarter of 2020 Solvency II data. The results show that the risk exposures of the European Union insurance sector slightly reduced, compared to July risk assessment. Insurers are particularly exposed to very high levels of macro risk, while market, credit, profitability and solvency risks decreased to medium level. However, the risk assessment does not account for the outbreak of the second...

November 10, 2020
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05Nov

Pension Schemes in the European Union: Challenges and Implications from Macroeconomic and Financial Stability Perspectives

By Antonio Sánchez Serrano,Tuomas Peltonen Pension schemes have a significant influence on the saving and consumption decisions of households. Similarly, contributions to pension arrangements are substantial expenditures for national governments and also for corporations, depending on the prevailing pension system. Beyond this, pension schemes play an important role in the economy, channelling savings into investments through capital markets. However, demographic factors and the macroeconomic environment (low interest rates, low growth and low productivity) are raising concerns about the sustainability...

November 5, 2020
Articles, Pension design, System Sustainability,
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05Nov

UK. Can superfunds be the silver bullet for DB woes?

Consolidation as a means of achieving better outcomes for pension schemes is a growing trend. This was highlighted in the UK’s Department for Work and Pensions’ (DWP) 2018 White Paper on protecting defined benefit (DB) pension schemes. However, the term ‘consolidation’ is in itself extensive in relation to what it exactly means to pension schemes. According to several investment consultants, consolidation should seek to achieve one or a combination of several goals: create efficiencies of scale; improve governance through...

November 5, 2020
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05Nov

Latvia. Constitutional Court to decide on minimal old age pension amount

On Wednesday, 4 November, a court hearing was commenced during which it is planned to decide on the current old age pension amount’s compliance with the Constitution of the Republic of Latvia. In accordance with Europe’s Reviewed Social Charter, the minimal old age pension amount in Latvia should be at least EUR 341 a month, whereas currently it is EUR 80, as reported by the Ombudsman’s Bureau. Ombudsman Juris Jansons turned to the Constitutional Court over the non-compliance of...

November 5, 2020
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03Nov

UK. Pensions risk transfer market resilient against Covid-19

The UK pensions risk transfer market has so far shown remarkable resilience to the economic impact of the Covid-19 pandemic. Although market conditions may mean some schemes will be further away from being able to de-risk than they were before the pandemic, the market remains busy and others will still be in a position to proceed with planned risk transfer activity. We can also expect to see a greater volume of forced transfer activity reaching the market in the...

November 3, 2020
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