NEWPORT BEACH, CA--(Marketwired - Jan 23, 2017) - Most global companies view retirement benefit plans as a valuable tool to help employees retire successfully and an essential offering when trying to retain and attract top talent, according to the 2nd Annual Global DC Survey for Multinational Corporations released by PIMCO, a leading global investment management firm.
Of the 26 firms surveyed, more than 60% ranked helping employees meet their retirement investment needs as the primary objective in offering defined contribution plans. Moreover, about half of the companies -- which represent $230 billion of defined contribution assets worldwide -- said they are likely to adopt more globally automatic enrollment and contribution-rate increases over the next few years. Meanwhile about a third is likely to roll out institutional investment strategies more globally such as white label/multimanager core and custom target-date/lifestyle strategies.
"Multinational corporations are seeking help as they roll out and evolve their DC plans around the globe," said Stacy Schaus, DC Practice Leader. "We created this survey to offer insight into global DC decision-making, governance and investments."
PIMCO's survey found companies are attempting to surmount the challenges in a number of ways.
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Over half of those surveyed make DC plan decisions locally with global or regional oversight or parameters; these include decisions about investment and plan design, and selection of investment and administration providers. Fewer than one in five reported that decision-making is centralized to global leadership.
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About two-thirds of the companies said they are at least somewhat likely to move toward global relationships in investment management, insurance and consulting.
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Organizations said improved governance, lower costs and idea generation are the most valuable benefits of globalized retirement efforts.
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To improve global oversight, more than four in ten organizations said they have gathered local plan details, written a global retirement plan philosophy, and established a global leadership team.
In terms of investment strategies preferred, the survey also found that a majority believes active management is important or very important for non-U.S. bonds, emerging market equities, non-U.S. equities (developed markets), U.S. bonds, target-date strategies, U.S. small cap equities and balanced strategies.
About the Survey
PIMCO created the Global DC Survey for Multinational Corporations in response to requests from global firms looking for a deeper understanding of how peers address the challenges associated with having similar, but not identical, pension obligations in multiple countries. The survey captures data, trends and opinions from 26 multinational plan sponsors, which serve over 1.2 million DC participants and more than $230 billion in DC assets. For survey highlights or other PIMCO DC publications, please contact us at 888.845.5012 or email us at pimcodcpractice@pimco.com