Pension investment strategy in light of new law

Pension investment strategy in light of new law
News from Pensions & Investments:

Bloomberg

Defined benefit plan sponsors in the U.S. now have the flexibility to reduce pension contributions to their plans in the near term, thanks to recently enacted pension funding stabilization legislation that allows plan sponsors to use a 25-year average of interest rates to calculate pension obligations. The average results in a higher discount rate than current market conditions, which lowers plan liabilities and resulting contribution requirements.

In addition, Pension Benefit Guaranty Corp. flat-rate premiums will increase significantly, while the annual PBGC levy on unfunded liabilities will move from 0.9% to 1.8% over the next few years. This creates a trade-off to be considered between any savings achieved by pension contribution deferral and the associated PBGC costs, as well as higher accounting costs as lower contributions levels will result in a reduction in the expected-return-on-assets component of pension expense.

In addition to pension contribution considerations, this is a good time for plan sponsors to assess their investment strategies. Considerable attention has been paid in recent years to liability-driven investment strategies, through which defined benefit plan assets are invested in a way to match the movements in the liabilities (the net effect is to reduce…………… continues on Pensions & Investments

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Research and Markets: Sustainable Investing for Institutional Investors. Risk …
News from The Herald | HeraldOnline.com:

Research and Markets (http://www.researchandmarkets.com/research/pccx7k/sustainable_invest) has announced the addition of John Wiley and Sons Ltd’s new book “Sustainable Investing for Institutional Investors. Risk, Regulations and Strategies” to their offering.

A comprehensive guide to socially responsible investing (SRI)

With concerns about climate change increasing among investors, many are looking for opportunities that offer positive social as well as monetary returns. Sustainable Investing for Institutional Investors: Risk, Regulation and Strategies explores the key issues related to “Socially Responsible Investment” (SRI) for institutional investors and trustees, including investment strategies, risk and returns, market data, regulatory frameworks, and more. Looking at all investment classes, including bonds, equities, real estate, commodities, and many others, the book provides an in-depth view of SRI-relevant asset classes to help you decide which is best for you.

To better contextualize SRI opportunities and challenges, the book presents 20 case studies involving institutional investors that are currently following a sustainable investment strategy and how they have approached SRI. For business leaders…………… continues on The Herald | HeraldOnline.com

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