The Pension Risk Strategy Roadmap
In the 2023 CFO Dive/Mercer survey results, which include responses from 152 senior financial executives who manage an organization's DB or pension plan, 88% of respondents indicate that they run a multi-year investment strategy. 83% said they manage the defined benefit plan using an integrated asset and liability framework and 89% say they already use or are currently considering using funding status and/or interest rate triggers to de-risk their portfolios.
Here's how organizations have been managing the obstacles they face in today's investing environment.
Interest Rate Hedging
Increasing Interest in Alternatives
As for the riskier, return-seeking side of the asset pool, some plan sponsors are considering diversifying away from public equities into private markets and alternatives.
What does this mean for DB plan sponsors? Ultimately, more complexity, more asset classes and different types of risk to manage.
of DB plan sponsors are likely to make greater use of derivatives.
likely to increase use of private assets.
added alternative investments in the past two years.
Specialized Expertise
Having the Right Guide
Executing de-risking quickly once funded status triggers are hit is crucial to lock-in gains and secure less future volatility
The right OCIO will aim to provide a full spectrum of services, offering complete end-to-end framework with a goal of transforming the way you manage your DB plan's financial uncertainties.
Download our full report: Next Steps in Pension Risk Management