German strategies report

Consultants Buck Heissmann is nearing completion of one of the first comprehensive studies of Germany’s company pension strategies, which could lead to a re-assessment of the amount of pension assets under management.

The study, commissioned by Goldman Sachs Asset Management, has the stated objective of identifying and cataloguing ‘Best practices’ of employers in formulating and implementing the financial strategy for the management of pension liabilities”.

Explaining the thinking behind the study, James Dilworth, who is res-ponsible for business development in Germany and Austria for Goldman Sachs Asset Management says: “Germany is certainly one of the major countries where we would like to en-hance our presence but before we make a significant commitment we really need to understand how the in-stitutional market works.

“The decision making process on why, where and how to invest is slight-ly different from the Anglo-Saxon markets. We wanted to find out for ourselves - using Buck Heissmann’s extensive experience - why that is the case.”

The study also seeks to investigate the extent to which funds are either already ‘externally managed’ through traditional pension funds, direct insurance and support fund vehicles or internally with book reserves ‘asset backed’ using vehicles such as Spezialfonds.

Dilworth adds: “We know that more and more companies with book re-serve systems are actively funding their pensions liabilities through Spezialfonds but outside of Pensionskasse. Then the market suddenly becomes significantly greater and more attractive than many outsiders believe.”

The study is expected to be present-ed to Goldman Sachs in November.”