Redefined providence (revising the Co-op pension scheme)

Redefined providence (revising the Co-op pension scheme)

Eyre N. Financial Management (UK), July/August 2006, Start page: 16 (4 pages)

Purpose – To tell how the UK Co-operative Group reformed its pension scheme without damaging its socially responsible reputation. Design/methodology/approach – Outlines the activities of the Co-op and its three main former pension schemes; and explains the pension risks identified in 2003 (mortality and equity), which were four times greater than any other significant risk to the group. Describes how a single, sustainable scheme was designed, which avoided shifting the risk to employees by moving from defined-benefit to defined-contribution, and solved some other problems of fairness.Originality/value – Explains briefly how one organization reformed its pension scheme to reduce risk without treating its employees unfairly.Reference: 35AT955

Keywords: Pension funds, Risk management, United Kingdom