The way corporations develop pension plan investment return assumptions "has been little short of scandalous," John C. Bogle, founder of Vanguard Group, said at a conference on corporate governance sponsored by the National Directors Institute. Corporations "ought to be required to report the past rates of returns their plans have actually achieved," he said Thursday.
Corporations should be required to present the basis for pension assumptions to their boards to "enable directors to make a fair determination of the reasonableness," Mr. Bogle said. "Further, serious security analysts should demand the right to review these data and, if appropriate, challenge the assumptions that are being made.
"It is only a matter of time until the basis of the assumptions is presented in the financial statements provided to shareholders," he said.