scholarly journals Let the Chickens Run the Henhouse? Democratizing Pension Funds: Corporate Governance and Accountability by Ronald B. Davis

2009 ◽  
pp. 285-290
Author(s):  
Randy Bauslaugh
Keyword(s):  
Decision Making ◽  
Corporate Governance ◽  
Pension Fund ◽  
Pension Funds ◽  
Environmental Responsibility ◽  
Central Thesis ◽  
Potential Benefits ◽  
Fund Governance

The central thesis of this interesting, but clearly labour biased book, is that employees or plan beneficiaries ought to exercise greater decision-making control over the pension funds they participate in. In this way, Professor Ronald Davis argues, investee corporations can be influenced to behave with greater social, ethical, financial, and environmental responsibility. Notwithstanding its arguably optimistic if not naïve view of the potential benefits of democratizing pension fund governance, this book deals with many themes that highlight deficiencies in governance and accountability that many practitioners in the pension industry would likely admit should be addressed.

Challenging investment decision-making in pension funds

2019 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Carl-Christian Trönnberg ◽  
Sven Hemlin
Keyword(s):  
Decision Making ◽  
Critical Incident ◽  
Pension Fund ◽  
Investment Decision ◽  
Investment Decisions ◽  
Pension Funds ◽  
Content Type ◽  
Fund Managers ◽  
Intuitive Thinking ◽  
Investment Decision Making

PurposeThe purpose of this study was to gain a better understanding of pension fund managers investment thinking when confronted with challenging investment decisions. The study focuses on the theoretical question of how dual thinking processes in experts’ investment decision-making emerge. This question has attracted interest in economic psychology but has not yet been answered. Here, it is explored in the context of pension funds.Design/methodology/approachThe sample included 22 pension fund managers. The authors explored their decision-making by applying the critical incident interview technique, which entailed collecting investment decisions that fund managers retrieved from recent memory (Flanagan, 1954). Questions concerned the investment situation, the decision-making process and the challenges and uncertainties the fund managers faced.FindingsMany of the 61 critical incidents examined concerned challenging (mostly stock) investments based on extensive analysis (e.g. reliance on external analysts for advice; analysis of massive amounts of hard company and stock market information; scrutiny of company reports and personal meetings with CEOs). However, fund managers to a high degree based their decisions on soft information judgments such as experience and qualitative judgements of teams. The authors found heuristics, intuitive thinking, biases (sunk cost effects) and social influences in investment decision-making.Research limitations/implicationsThe sample is small and not randomly selected.Practical implicationsThe authors suggest anti-bias training and better acquaintance with human forecasting limitations for pension fund managers.Originality/valuePension fund managers’ investment thinking has not previously been investigated. The authors show the types of investment situations in which analytical and intuitive thinking and biases occur.

scholarly journals ANALISIS FAKTOR-FAKTOR YANG MEMPENGARUHI KUALITAS LAPORAN KEUANGAN DANA PENSIUN

2012 ◽  
Vol 12 (2) ◽  
pp. 107
Author(s):  
Nur Hasanah
Keyword(s):  
Earnings Management ◽  
Significant Influence ◽  
Pension Fund ◽  
Audit Quality ◽  
Multiple Linear Regression Model ◽  
Pension Funds ◽  
Financial Reports ◽  
Fund Governance ◽  
Variable Performance

<span>This research aims to investigate the factors that influence to the quality of pension fund <span>financial reports, a proxy with earnings management. These factors related to corporate <span>governance. This research using 22 Pension Fund in Indonesia, which was established <span>and approved by the Minister of Finance until 2005 and still actively running the business as the Pension Fund by the end of 2009. The research period is taken is 4 years, starting in 2006 until 2009. This research used multiple linear regression model. The independent variable in this research include variable performance of the Pension Fund, the rights of stakeholders, disclosure, and type of Pension Fund that is predicted significant influence on the quality of pension fund financial reports. The result of this research showed that only the audit quality has positive and significant influence on the quality of Pension Fund financial reports, whereas for the variable performance of the Pension Fund, the rights of stakeholders, disclosure, and type of Pension Fund showed no significant effect on the quality of the financial reports of the Pension Fund. Variable types of the Pension Fund (sharia and non-sharia), no significant influence on the quality of Pension Fund financial reports, this can be expected because up to this time there are no special regulations for sharia Pension Funds. Sharia arrangements in relation to aspects of Sharia Pension Funds activities, such as guidelines for preparing<br />the financial reports of Sharia Pension Fund is still using regulations that apply to non Sharia Pension Fund. Simak<br />Keywords: Good corporate governance, good pension fund governance, Pension Fund financial reports, sharia pension fund, earnings management.<br /></span></span></span></span>

Actuaries, Pension Funds and Investment

1992 ◽  
Vol 43 ◽  
pp. 125-166
Author(s):  
T. G. Arthur ◽  
P. A. Randall
Keyword(s):  
Decision Making ◽  
Asset Allocation ◽  
Performance Monitoring ◽  
Pension Fund ◽  
Pension Funds ◽  
Investment Performance ◽  
Institutional Investment ◽  
Fund Investment

AbstractThe authors discuss the investment of pension and other institutional funds, stressing a theme of investing to meet liabilities. Their aim is to stimulate debate by actuaries and the investment community, leading to the development of better approaches to pension fund investment and its monitoring.The first part of the paper considers the matching of assets to liabilities, concentrating on a major principle applicable to actuarial valuations where assets and liabilities are mismatched.The paper goes on to consider principles of institutional investment and includes discussions of the meaning and measurement of risk, the setting of investment objectives, decision-making, asset allocation and investment performance monitoring.

scholarly journals Pension fund trustee competence: decision making in problems relevant to investment practice

2006 ◽  
Vol 5 (1) ◽  
pp. 91-110 ◽  
Author(s):  
GORDON L. CLARK ◽  
EMIKO CAERLEWY-SMITH ◽  
JOHN C. MARSHALL
Keyword(s):  
Decision Making ◽  
Pension Fund ◽  
Service Providers ◽  
Investment Decisions ◽  
Pension Plan ◽  
Defined Benefit ◽  
Defined Benefit Pension Plan ◽  
Fund Governance ◽  
Psychology Literature

Government-sponsored inquiries into trustee competence, and legislation regarding the protocols and practice of trustee decision making, have raised questions about the competence of trustees to make investment decisions consistent with the long-term interest of defined benefit pension plan beneficiaries. In this paper, we report the results of an analysis of trustee competence in solving problems relevant to their investment responsibilities. Based upon a set of widely recognized problems drawn from the psychology literature, we assess their discount functions, their willingness to risk their own money and others' money, their appreciation of probability, and their use of evidence to solve problems. For comparison, where appropriate we report the results of the same testing regime applied to a group of Oxford undergraduates. Our goals are fourfold: first, to demonstrate the nature of trustee competence in decision making; second, to demonstrate the range of trustee responses to problems relevant to investment; third, to assess trustees' risk appetites in relation to their own and others' money; and fourth, to draw implications from these results for the governance of trustee boards and their relationships with advisers and service providers. It is shown that trustee competence is surprisingly heterogeneous, and the lack of common approaches to problems relevant to investment practice has significant implications for fund governance.

Pension fund governance: expertise and organizational form

2004 ◽  
Vol 3 (2) ◽  
pp. 233-253 ◽  
Author(s):  
GORDON L. CLARK
Keyword(s):  
Pension Fund ◽  
Codes Of Conduct ◽  
Pension Funds ◽  
Defined Benefit ◽  
Defined Contribution ◽  
Internal Governance ◽  
Codes Of Practice ◽  
Anglo American ◽  
Fund Governance ◽  
Equitable Treatment

Responsible for the welfare of beneficiaries, pension funds have many tasks and functions. Consequently, their governance and regulation are issues of public concern with direct bearing on the interests of stakeholders and ultimately the performance of Anglo-American financial markets. Subject to common law expectations regarding proper trustee behaviour, also important are statutory requirements regarding the equitable treatment of beneficiaries and the management of assets and liabilities. At one level, discretion is an essential attribute of the trust institution – trustees act on behalf of others not so well placed to manage their own long-term welfare because of lack of knowledge and/or ability. At another level, pension funds are presumably regulated by a well-defined purpose – the welfare of beneficiaries. In this paper, I look at the internal governance of pension funds emphasizing codes of practice, the rules and procedures for decision making, and trustee competence and expertise. While it is important to observe codes of conduct like those advocated by the OECD, there may be significant problems with any system of governance that relies upon rules and procedures. Inertia rather than innovation may be the net result. These issues are developed with reference to defined benefit and defined contribution schemes (and their variants). Ultimately, pension fund governance reflects, more often than not, its nineteenth-century antecedents rather than the financial imperatives of the twenty-first century.

scholarly journals Pension fund governance: The Polish experience

2014 ◽  
Vol 11 (3) ◽  
pp. 349-357
Author(s):  
Adam Samborski
Keyword(s):  
Pension Fund ◽  
Pension System ◽  
Pension Funds ◽  
Small Fragment ◽  
Fund Management ◽  
Pension Systems ◽  
Pension Fund Management ◽  
Polish Experience ◽  
Fund Governance

Despite a comprehensive pension related debate held on the governmental level and in media in Poland, little time was spent, however, on discussing nature and usefulness of governance in the context of pension systems aimed at would-be-pensioners. Attention is predominantly paid to the role of governance for investments. Unfortunately, governance is not addressed, with reference to pension funds, the way it should be. The author is looking for answers to questions about the state of pension fund governance in Poland, thus trying to find methods for improvement. Nevertheless, this text concentrates on a small fragment of the pension system in Poland. The article aims at attempting identification of issues to be faced by governance in voluntary pension funds that are managed by universal pension fund management companies.

scholarly journals ANALISIS FAKTOR-FAKTOR YANG MEMPENGARUHI KUALITAS LAPORAN KEUANGAN DANA PENSIUN

2011 ◽  
Vol 11 (1) ◽  
pp. 71
Author(s):  
Nur Hasanah
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Significant Influence ◽  
Pension Fund ◽  
Audit Quality ◽  
Multiple Linear Regression Model ◽  
Pension Funds ◽  
Financial Reports ◽  
Variable Performance

<p class="Style18">This research aims to investigate the factors that influence to the quality of pension fund financial reports, a proxy with earnings management. These factors related to corporate governance. This research using 22 Pension Fund in Indonesia, which was established and approved by the Minister of Finance until 2005 and still actively running the business as the Pension Fund by the end of 2009. The research period is taken is 4 years, starting in 2006 until 2009. This research used multiple linear regression model.</p><p class="Style18">The independent variable in this research include variable performance of the Pension Fund, the rights of stakeholders, disclosure, and type of Pension Fund that is predicted significant influence on the quality of pension fund financial reports. The result of this research showed that only the audit quality has positive and significant influence on the quality of Pension Fundfinancial reports, whereas for the variable performance of the Pension Fund, the rights of stakeholders, disclosure, and type of Pension Fund showed no significant effect on the quality of the financial reports of the Pension Fund</p><p class="Style18">Variable types of the Pension Fund (sharia and non-sharia), no significant influence on the quality of Pension Fund financial reports, this can be expected because up to this time there are no special regulations for sharia Pension Funds. Sharia arrangements in relation to aspects of Sharia Pension Funds activities, such as guidelines for preparing the financial reports of Sharia Pension Fund is still using regulations that apply to non-Sharia Pension Fund.</p><p class="Style1">Keywords: Good corporate governance, good pension fund governance, Pension Fund financial reports, sharia pension fund, earnings management.</p>

scholarly journals THE EFFECT OF BOARD DIVERSITY ON FINANCIAL PERFORMANCE OF EMPLOYER’S PENSION FUND

2011 ◽  
Vol 10 (2) ◽  
Author(s):  
Apriani Dorkas Rambu Atahau ◽  
Supatmi .
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Financial Institutions ◽  
Pension Fund ◽  
Defined Benefit ◽  
Public Attention ◽  
Board Diversity ◽  
Good Corporate Governance ◽  
Fund Governance ◽  
Fund Size

Good corporate governance as a concept gains wide public attention especially after the 19971998 financial crises. The falls of many financial institutions is believed related to the absence of good corporate governance. As one of financial institutions which mainly serve for providing future benefits after retirement, Indonesian employer’s pension fund also required to implement good pension fund governance through a regulation from Flead of BAPEPAM-LK Number Kep-136/BL/2006 about the Guidelines of Pension Fund Governance. The implementation of this regulation will give impacts on the board diversity since the board will be the front line in implementing good pension fund governance.The objective of this research is to examine the effect of board diversity to financial performance of Indonesian employer’s pension fund. In this research, board diversity is measured by three variables, i.e. gender, education background and duality. Financial Performance is measured by Return on Investment, Return on Assets and Fund Sufficiency Ratio. Research sample consists of ten employer’s pension fund as members of Indonesian Christian Pension Fund Association who conduct defined benefit program, which possesses complete data from 2006-2009 Association’s Directory. Analysis is done with multiple regressions by controlling pension fund basis, board size and pension fund size. The result finds that board diversity impact employer’s pension fund financial performance. It implies the need to consider board heterogeneity in the election of board member to optimize employer’s fund financial performance.

Reforms press Japanese firms to put cash to use

2015 ◽  
Keyword(s):  
Corporate Governance ◽  
Pension Fund ◽  
Critical Mass ◽  
Peer Pressure ◽  
Pension Funds ◽  
Ageing Population ◽  
Governance Reform ◽  
Content Type ◽  
Financial Investment ◽  
Fund Portfolio

Subject Pension fund and corporate governance reform in Japan. Significance Corporate hoarding of cash and deposits rose to a record 233 trillion yen (2 trillion dollars) at the end of September 2014, the latest Bank of Japan data show. However, reform efforts are under way to promote risk-taking and increase returns from financial investment. They include changes to the portfolios of government pension funds, a new corporate governance code, a stewardship code for institutional investors and a new equity index to showcase the firms giving the best return on equity. Impacts Public pension fund portfolio changes could shift tens of billions of dollars into foreign equities and bonds. The demands of an ageing population will add to pressure on pension funds to seek higher returns. Peer pressure could be a powerful motivator if a critical mass of companies can be persuaded to change.

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