Organizational structure of pension funds, Financial Management

Organizational Structure of pension funds

In an investment organization such as pension funds, endowments, life and casualty insurance companies, the central bank's investment professionals are responsible for implementing asset portfolios as these organizations face several challenges. As the pension funds comprise the highest net worth of managing fund, they should be more cautious about the investment. Investment management companies should have the expertise to deal with different types of investors as well as the ability to resolve various investment issues the sponsors encounter. These issues include - strategic asset allocation, risk management, portfolio construction, and performance measurement and attribution. Investment management companies at times have to face increasing demands from institutional investors, and may be forced into an activity in which they have no comparative advantage in an attempt to satisfy large investors.

Governance and Organization Structure

A pension fund is operated and advised by a mix of internal and external experts (i.e., agents); it must be governed and monitored by a body of people who have accepted the responsibility to keep the stakeholder "value creation" as their business goal clearly in mind. In a pension fund, members of the board of trustees are the governors of the fund. They are responsible for the governance and ultimately for the investment result. A board or an oversight committee have the overall responsibility for developing the long-term asset mix, providing guidelines for investment strategy, and reviewing performance of the fund. Trustees must sort out who the stakeholders in the pension plan are (i.e., retirees, active plan members, shareholders or taxpayers), and what loyalties they owe and to whom.

 

Posted Date: 9/11/2012 1:38:53 AM | Location : United States







Related Discussions:- Organizational structure of pension funds, Assignment Help, Ask Question on Organizational structure of pension funds, Get Answer, Expert's Help, Organizational structure of pension funds Discussions

Write discussion on Organizational structure of pension funds
Your posts are moderated
Related Questions
Why are trend analysis and industry comparison important to financial ratio analysis? Trend analysis assists financial analysts and managers see whether a company's current fin

Explain Gresham’s Law. Answer:  Gresham’s law considers to the phenomenon that bad (abundant) money drives good (scarce) money out of circulation. This type of phenomenon was fre

In the 2000s the German discount chain Aldi began an expansion on the east coast of Australia. One strategy of Aldi is to encourage small retailers such as butchers, bakers, delica

Tax-backed debt obligations are the debt instruments issued by counties, states, cities, towns, special districts and school districts. These are secured by some

Market based Ratio's   PE:           The Price-to-Earnings ratio is calculated by market price per share to earnings per share and is expressed in terms of times. It shows h

Common-size Analysis • Prepare a Common-size Analysis for the Balance Sheet and Income Statement • This should include about 12 accounts in the Balance Sheet and about 10 Inc

What is the usual pattern of cash flows for a share of preferred stock? How does the market determine the value of a share of preferred stock, given these promised cash flows?

Question 1 Define 'Trust'. Explain in detail the various types of Trust Question 2 Discuss the concept of Tax Planning. Identify difference between Tax Planning and Tax Ev

Q. Define a currency futures contract? A currency futures contract is a standardised contract for the buying or else selling of a specified quantity of currency. It is traded o

To what extent does empirical evidence on corporate objectives support the predictions of Baumol’s “Sales Maximisation Hypothesis?”