Divining the future of DB plans

OXFORD, England — Pensions & Investments and Oxford University have launched a groundbreaking survey on the future of defined benefit plans around the world.

P&I readers can give their views on the following issues, among others:

• Whether defined benefit plans will still be open to new members in 20 years;

• If sponsors of plans with deficits will struggle to compete in a global economy;

• How much influence plan sponsors have over asset allocation; and

• Whether mature DB plans should invest mainly in bonds.

The survey is being conducted by Gordon Clark, a professor at Oxford, who seeks to discover the points of agreement and disagreement among different groups of professionals — pension executives and plan trustees, as well as investment service providers such as money managers and consultants.

"It will be almost impossible to create a long-term solution to the current problems unless we understand what has gone wrong," said Mr. Clark.

Earlier research by Mr. Clark and Ashby Monk, a doctoral candidate at Oxford, showed a lack of consensus among service providers, plan executives and trustees about defined benefit plan problems and solutions. In fact, Mr. Clark said, professionals in the same industry — such as consultants — can't even agree on the root causes of current liability management difficulties.

The P&I/Oxford survey was born from a questionnaire issued last May to around 50 pension experts attending a conference in Oxford, that was sponsored by Oxford University; Harvard University, Cambridge, Mass.; and the Lupina Foundation, Toronto, which funds research on health and society issues.