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Impact Investing

IPE special report May 2018

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Proximus gets its own pension fund

Proximus, the mobile phone subsidiary of Belgacom – the Belgian telecommunications group – is to create its own pension fund in the coming months.
Fabian de Bilderling, recruited to Belgacom in November from consultant Watson Wyatt, will take an active role in the implementation of the new scheme, which is expected to receive an initial e15-20m transfer from the present insurance contract.
Yearly inflow to the defined benefit (DB) plan is put at around e5m and projected to expand rapidly.
Phillip Neyt, director general of the e2.5bn Belgacom pension fund and recently promoted to chairman of the group’s new Treasury Council – a link body between the corporation and the pension plan, says the group has already negotiated the insurance company switch into the pension fund at zero cost and explains the new fund’s structure: “Proximus has an expanding population – there are over 2000 people there at present with an average age of 29-30 - so it is a very young fund.
“It will be a separate legal entity but managed on a group level.
“They have their own separate board but we do the negotiations together. There will also be a link with the insurance company to be renegotiated for death and disability, which will be done on a group level.”
Neyt says the group is presently looking at the scheme design before putting out an RFP for managers.
“Once we have decided on this design we will draw up an appropriate strategic asset allocation and try to optimise that by selecting managers and doing tactical asset allocation and tracking error etc.”
He notes that the group involvement is part of an overall strategy to align company benefits: “We serve all the affiliates, do the negotiations, set up the structure and try to harmonise all the benefits. What this means is that a guy who moves from Proximus to Belgacom or the other way around does not have a career interruption.
“Also Belgacom has the bargaining power with the insurance companies to negotiate better on a group level than through each affiliate separately.”

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