Firms shuttering defined benefit pension plans for new schemes
GLOBAL firms are mirroring UK corporate pension trends by closing defined benefit (DB) schemes, a poll shows today.
Just six per cent of companies in a sample of Fortune 500 companies were willing to keep DB schemes open, according to the poll by PwC.
Nine out of 10 said they were switching to defined contribution schemes, with 83 per cent of multinationals closing their DB schemes to new entrants. The survey asked 114 companies from the Fortune 500, who together employ 4.7m people.
“In spite of the best efforts of sponsoring employers, defined benefit pension deficits have remained stubbornly on corporate balance sheets,” global pensions leader Marc Hommel said.
The research also revealed that almost 80 per cent of the businesses polled said they had pension liabilities exceeding a third of their market cap.