A non-U.S. pension fund has set an example of disclosure using the Internet that others should emulate.
The fund, Pensionskasse Schweizerischer Elektrizitatswerke in Zurich - known as PKE - will post its investment returns on its Internet Web site. As reported in a Pensions & Investments story, it is believed the first such type of disclosure for a defined benefit plan. The information on the Internet will include manager mandates in addition to the performance.
The move should serve as a model for other defined benefit pension funds, especially because of the low-cost way the information can be dispersed on the Internet. Providing such revealing return reports - on paper - isn't unique, though it is rare. Affordability no can longer be an excuse for not providing such disclosure.
PKE's move drew an odd comment from one consultant who questioned why a fund would want to disclose such information. It might lead to questions by participants on managerial performance, he said.
What's wrong with that? Pension plan participants have a stake in whether or not a fund is being effectively managed - their benefits ultimately, though indirectly, depend on fund performance.
And holding the efforts of both pension executives and the managers they hire up for public inspection might improve the efforts of both.
Now, because of the investment education participants are getting through defined contribution plans, beneficiaries are better equipped to understand asset allocation and performance and ask pertinent questions. Why not let them do so if they wish? The Internet is a relatively inexpensive way to provide the information.
The pension industry has too long hidden from public scrutiny. PKE, at least, is breaking away from that attitude.
