Better Measurements: Risk Reporting for Public Pension Plans
A conference hosted by the Mossavar-Rahmani Center for Business & Government on September 21, 2018
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A previous conference hosted by M-RCBG highlighted the difficulty of measuring risk at public pension plans in a way understandable to multiple audiences, and also the difficulty in comparing various plans when each uses a different yardstick. This 2018 conference, Better Measurements: Risk Reporting for Public Pension Plans, was designed to further address these issues. In particular: What are the objectives of measurement? What is the current state of play? Could we agree on a uniform set of best practices?
At the Better Measurements conference, a framework was presented by The Pew Charitable Trusts, as a strawman proposal and then subsequently distributed for comment. A final version of this framework, entitled the Foundation for Pension Risk Reporting, is available here.
This document focuses on the measurement and assessment of investment and contribution risks for public pension plans – areas where there appears to be a strong measure of consensus regarding priorities – to inform planning and decision making. Recognizing that not everyone will agree on every detail, this final document reflects changes in response to most of the substantive suggestions that were received from conference participants. The conference organizers* believe that it represents a robust and reasonable starting point for pension risk reporting.