Response to the European Commission White Paper

Noël Amenc, François Cocquemas, Lionel Martellini, Samuel Sender: After a short summary of some of the main challenges facing European pension systems, this paper discusses the Commission’s proposals point by point.

Author(s):

Noel Amenc

Professor of finance and director of EDHEC-Risk Institute.

Francois Cocquemas

PhD in Finance candidate and research assistant at EDHEC-Risk Institute.

Lionel Martellini

Professor of finance at EDHEC Business School and scientific director of EDHEC-Risk Institute.

Samuel Sender

Applied research manager at EDHEC-Risk Institute.

Our three key messages are the following. First, the current pension debate should be used by the Commission to foster increased coordination in pension reform. When discussing the sustainability of public finance, one medium-term objective could be to recognise unfunded implicit pension commitments. Second, the prudential framework for pensions is bound to have far-reaching consequences, and it needs to respect the particularities of pension providers, which are not those of insurers. Third, new regulation should encourage the generalisation of asset-liability management practices, both for pension funds and individual retirement products, using the best available knowledge and techniques and evaluating micro as well as macroeconomic impacts. A move towards hybrid pensions could, with these objectives in mind, provide a more adequate conceptual framework for European countries to converge towards. Only with those can the goals of adequacy, safety and sustainability for European pensions ever be met.
Pdf
Response to the European Commission White Paper ...
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Type: EDHEC Publication
Date: le 03/10/2012
Extra information : For more information, please contact EDHEC Research and Development Department [ research@drd.edhec.edu ]
Research Cluster : Finance

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