EUROPE - European pension schemes have increased their exposure to equities in 2008, despite recent troubles, according to a survey from Mercer.
Mercer also found a greater appetite for liability driven investment (LDI) strategies, with the number of schemes considering this approach having doubled in a year.
Andrew Kirton, head of Mercer's European consulting business, commented: "Investing relative to the liabilities, whereby the amount and nature of risk taken on is assessed relative to the liabilities, has much to commend it, at least in terms of a frame of reference for decision-making, where solvency and/or maturity considerations are important in markets such as the Netherlands, UK and Ireland."
The survey also revealed diversification was on the rise in European pension portfolios.
Kirton said: "It is encouraging to note that risk management is high up many investors' agendas, together with an awareness that market turbulence, whilst demanding that risk exposures be understood and controlled, should also lead to investment opportunities as the year progresses."
Mercer said pension fund trustees had become more comfortable with implementing effective governance structures to navigate the growing complexity of the investment landscape.
It reported trustees were more inclined to delegate short term investment decisions to asset managers and consultants thereby adapting more easily to market-related factors affecting allocation strategies.
The Pensions Regulator (TPR) has set out plans to use "new regulatory initiatives" with over 1,000 schemes as it aims to tighten its regulatory grip and boost member outcomes.
HM Revenue and Customs (HMRC) has announced it is delaying the provision of data that will enable pension schemes to confirm the guaranteed minimum pension (GMP) benefits to pay to members until the end of the year.
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