September 2020

23Sep

UK. Pension funds should allocate towards infrastructure and growth assets as government bonds now provide “return-free risk”, says Baroness Altmann

Former pensions minister and peer of the House of Lords, Baroness Ros Altmann is a well-known economist and campaigner. Her work has included leading a lobby that secured millions of pounds in compensation for the retirees of the UK’s former nationalised steel industry, who faced losing their entire state pensions. Read also UK. Platform giants join firms in pension switching call Speaking at the World Pensions Council’s virtual conference, the G7 Pensions Investment Summit, Altmann said that pension funds must...

September 23, 2020
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22Sep

Beijing Taking Measures To Address China’s Upcoming Retirement Savings Deficit

China has been leveraging the domestic interest rate as an integral part of its monetary policy since the opening up of the bond market in 2019, increasingly allowing international investors to hold municipal bonds. Read also Canada. OSFI launches discussion on tech risks to pensions, other federal financial institutions Further into its liberalization of the market, China also allowed foreign capital to play a part in its funds market from earlier this year. Read also Switzerland. Credit Suisse pension...

September 22, 2020
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22Sep

Japan’s new PM could seek to improve GPIF oversight

Japan’s newly elected prime minister Yoshihide Suga may seek to form an independent board to oversee the Government Pension Investment Fund (GPIF). However, experts said that it may not happen at least until his re-election in October next year. Read also Japan proposal on contribution limits could hurt The debate about whether the GPIF should have an independent board instead of coming under the oversight of the Ministry of Health, Labour and Welfare (MHLW) started several years ago, with many...

September 22, 2020
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21Sep

UK. Platform giants join firms in pension switching call

latform giants Hargreaves Lansdown and Aegon are among 67 firms to join an initiative calling for greater standards in pension switching. The partnership between Criterion and TeX, under the brand of Star, is working on a transfers & re-registration initiative which it hopes will shape "recognised, industry-wide standards to promote good practice in transfers". Fidelity and Standard Life have also petitioned their fund groups to support the campaign. Andrew Marker, chairman of the Star steering group and...

September 21, 2020
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15Sep

MetLife to Face Appeal of Suit Over $500 Million Annuity Error

A group of MetLife Inc. investors will ask Delaware’s top court to revive oversight claims over the insurer’s practice of downplaying its liabilities by counting pensioners as dead if they didn’t respond to its letters, instead of consulting official records. The lawsuit, dismissed by a Chancery Court judge in August, concerned MetLife’s “pension risk transfer” operations, a long-running business line that involves managing pension obligations for employers. The insurer for decades based its annuity payments on letters sent to...

September 15, 2020
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14Sep

S. Korea’s state pensions to face steep shortfall in 20 yrs: report

South Korea’s state-managed pension and insurance funds may dry up earlier than expected, suggesting the need of dramatic changes to cope with demographic trends and funding shortfalls in the foreseeable future, a government report projected. According to the fiscal outlook report for 2020-2060 by the Ministry of Economy and Finance, state-run National Pension Service, the world’s third largest pension fund, is estimated to return to a net loss by 2040 if conditions remain unchanged from now. The analysis projects...

September 14, 2020
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11Sep

One of Sweden’s Biggest Investors Starts ESG Pressure Campaign

Alecta, a Swedish pension fund with about $110 billion under management, wants to take active investing to a new level to force the companies it owns to be more ethical. Carina Silberg, who runs a newly merged corporate governance and sustainability unit at Alecta, says her team is bringing in reams of data to figure out exactly what portfolio companies are doing when it comes to environmental, social and governance standards. If “large gaps” are identified, “targeted action” follows, she...

September 11, 2020
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04Sep

Norway Pension Giant Drops Three Companies over Alleged Human Rights Violations

Norway’s $1.17 trillion Government Pension Fund Global (GPFG) said it is excluding three companies from the fund because of an “unacceptable risk for violation of human rights.” They are Taiwan-based Formosa Chemicals & Fibre Corp. and its subsidiary Formosa Taffeta, as well as Indian textiles company Page Industries. Norway’s central bank, Norges Bank, which manages the country’s sovereign wealth fund, made the decision based on the recommendations of its Council on Ethics. The council also recommended that the fund...

September 4, 2020
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03Sep

Pensions Need a ‘Safety Valve,’ Says JPMorgan

Pensions entered the Covid-19 pandemic significantly exposed to corporate credit risk, relying on a traditional investment strategy that may be heading for failure, according to JPMorgan Chase & Co.’s asset management group. They’ve been hedging the volatility of their pension liabilities by taking on “a very concentrated exposure to corporate credit,” Jared Gross, the head of institutional portfolio strategy at J.P. Morgan Asset Management, said in a phone interview. Largely holding corporate bonds at risk of being downgraded...

September 3, 2020
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August 2020

28Aug

US. The Future for ESG Investing in Retirement Plans

The department of labor (DOL)’S proposed rule on environmental, social and governance (ESG) investment practices, published in June, intended to add clarity to years of obscure regulatory guidance. Instead, it’s created a layer of complexity among fiduciaries and has fueled more than 1,000 critical comments. The proposed regulation restates that plan sponsors in defined contribution (DC) plans cannot disregard financial approaches in an effort to pursue ESG-related considerations without violating their fiduciary duties under the Employee Retirement Income Security...

August 28, 2020
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