According to the country's asset management trade group, Swiss lawmakers presided over a "lost opportunity" to improve workplace pension management.
The Swiss Asset Management Association (AMAS) said that the Council of States "passed up an opportunity to professionalise occupational pension provision," which it believes might boost returns even more.
The body emphasised that pension funds are many Swiss people's greatest saved asset. Yet, given their "enormously high fiduciary obligation," the required expertise and knowledge levels of the boards of trustees that oversee such schemes were missing.
“The Swiss pension fund system urgently needs modernisation in the central areas of investment competence and risk management to better exploit the return potential in the individual pension funds,” it said.
“For some time now, the investment return on Swiss pension fund assets, the so-called third contributor, has contributed more to asset growth than employee or employer contributions.”
It claimed that during the last 15 years, investment returns amounted to an average of 30 billion Swiss francs per year in pension fund asset growth.
“Implementing the motion would have made a significant contribution to further strengthening the pension funds,” it added. “A comprehensive professionalism of the investment management of pension fund assets has a positive effect on the exploitation of existing return potential, taking into account the risk capacity.”
The motion, proposed by the Swiss Parliament's Social Security and Health Committees, sought to strengthen investment expertise, provide comprehensive risk management, and eliminate asset class exposure limitations in order to better reflect varied risk structures.
Strengthening Swiss pension funds and individual pension provisions "remains a strategic objective," according to AMAS.
“The association will continue to advocate strengthening the third contributor, and thus the occupational benefit scheme,” it said.
By fLEXI tEAM