Research Brief: Global Pension Plans

Despite global stock and bond market improvement, pension underfunding remains a significant problem for both retirees and investors. While U.S. companies are the best funded of the three developed regions we examine, only 38% of S&P 500 companies with pension obligations have a funding status (pension assets to liabilities) of 90% or better. We see trends that may keep pressure on global pension funding: the continued fall in interest rates in 2014, which will likely result in lower discount rates and corresponding higher pension obligations; a global decrease in employer contributions to pension plans over the past five years; and the potential for decreased investing returns following a six-year global equities bull market.

Highlights From The Report:

• Companies with the strongest and weakest pension funding globally.
• Global trends in pension funding and accounting.
• Companies with the most and least aggressive pension accounting assumptions.
• Underfunded plans with the least and most funding improvement.