UK – Christine Farnish, the chief executive of the National Association of Pension Funds, has backed the idea of Dutch-style multi-employer pension schemes.

Occupational pension schemes can be “extremely cost-effective”, Farnish noted in a letter to the Financial Times.

“They have the added benefit of allowing some diversity of benefit design, and some risk-sharing between employer and employee.”

“The challenge for ensuring cost-effective provision for smaller employers could be achieved through multi-employer schemes of the kind that has proved successful in the Netherlands.”

Meanwhile, the NAPF has called for pension funds to hold firms to account over corporate social responsibility.

It said CSR “should be part of companies’ normal business agenda, and pension schemes and other investors should ensure that boards adopt appropriate policies”.

But it said it doesn’t intend to publish CSR guidelines similar to those on corporate governance.

“We have been saying for some time that company boards should be mindful of the wider role of the company in society, and that failure to do so could mean serious damage to a company’s long term prospects and therefore to shareholder interests,” Farnish said.

“This statement goes further. It makes clear that investors have a role to play in ensuring that CSR issues are part of a company’s normal business agenda. The management of the company should disclose, and be held accountable for, implementation of these policies.”

Topics