Occupational Pension Schemes in Ireland: A Review of Risk and Investment Strategies

The pensions industry is a multi – billion euro industry world wide. As at December 2002, Irish pension fund assets under management (not including the Government Pension reserve Fund) were of the order of 50,618.5m. Euro. Recent stock market performances coupled with a number of high – profile corporate failures have focussed attention on the vulnerabilities of funded pension systems. This paper looks at the role of funded occupational pension schemes in Ireland and specifically at the risks inherent in both the investment strategies of these schemes and the institutional structure of pension fund provision. It questions whether pension funds by embracing these risks are serving the objectives of the individual beneficiaries of the schemes, the trustees and the sponsor companies.