Modernizing Pension Fund Legal Standards for the Twenty-First Century

9 Pages Posted: 23 May 2009 Last revised: 27 May 2009

See all articles by Keith L. Johnson

Keith L. Johnson

affiliation not provided to SSRN

Frank Jan de Graaf

Amsterdam University of Applied Sciences; University of Amsterdam - Department of Business Studies (BS)

Date Written: May 20, 2009

Abstract

This paper argues for a modernized interpretation of fiduciary duty that recognizes the symbiotic relationship between the sustainable success of both corporations and pension funds. It describes the impact that pension investment practices have on both the well being of fund participants and the health of the global economy. It also argues that fiduciaries should adopt pension fund governance practices found to be associated with improved investment performance, better align pension fund service provider incentives with the clients' long-term interests, and expand risk identification and management practices to consider systemic and extra-financial factors that may not be reflected on corporate financial statements but have contributed to the current financial crisis. The authors recommend development of pension fund governance best practice guidelines combined with adoption of a 'comply or explain' reporting scheme as a way to improve the ability of pension managers to meet their fiduciary obligations and promote economic stability.

Keywords: Best Practices, Fiduciary Duty, Financial Markets, Fund Governance, Market Reform, Rotman

Suggested Citation

Johnson, Keith L. and de Graaf, Frank Jan, Modernizing Pension Fund Legal Standards for the Twenty-First Century (May 20, 2009). Rotman International Journal of Pension Management, Vol. 2, No. 1, 2009, Available at SSRN: https://ssrn.com/abstract=1408691

Keith L. Johnson (Contact Author)

affiliation not provided to SSRN ( email )

Frank Jan De Graaf

Amsterdam University of Applied Sciences ( email )

Wenckebachweg 144-148
Amsterdam, 1000BA
Netherlands

University of Amsterdam - Department of Business Studies (BS) ( email )

University of Amsterdam Business School
Plantage Muidergracht 12
Amsterdam, 1018 TV
Netherlands

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