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EDHEC finds European pensions hold ‘blinkered’ view of risk


A new survey of asset/liability management specialists in Europe shows that accounting risk or the volatility from the pension fund in the company’s books is managed by fewer than half of them, while 50% ignore the risk of a bankrupt plan sponsor leaving a pension fund with deficits.

In France, the EDHEC Risk Institute finds that pension funds generally do not assess the adequacy of their asset liability management, which may lead to sub-optimal decisions being repeated again and again. Almost half of the 129 pension funds surveyed imprecisely modeled their liability hedging portfolio, which in most cases