Eliciting Pension Beneficiaries’ Sustainability Preferences: Why and How?

Wharton Pension Research Council Working Paper No. 2021-12

Published in Hammond, P.B., R. Maurer, and O.S. Mitchell (Eds.) (2023). Pension Funds and Sustainable Investment: Challenges and Opportunities. Oxford: Oxford University Press.

Posted: 24 Jul 2021 Last revised: 19 May 2023

See all articles by Rob Bauer

Rob Bauer

Maastricht University; European Centre for Corporate Engagement (ECCE)

Paul Smeets

University of Amsterdam

Date Written: July 1, 2021

Abstract

We explore whether beneficiaries of pension plans should have a voice in the fund’s sustainable investments. We hypothesize that the answer to this question depends on a fund’s legal and societal contexts, benchmarking pressure, and fund-specific factors such as the fund’s size and the board’s composition. We uncover heterogeneity in the degree to which beneficiaries are involved in decision-making. Some pension funds have started a dialogue with their participants, mainly using survey instruments. We provide an example of a fund that gave its participants a real vote, while avoiding the pitfalls that come with hypothetical surveys on individual preferences.

Keywords: pension participant survey, social preferences, socially responsible investments

JEL Classification: G02, G20, G23, G28

Suggested Citation

Bauer, Rob and Smeets, Paul, Eliciting Pension Beneficiaries’ Sustainability Preferences: Why and How? (July 1, 2021). Wharton Pension Research Council Working Paper No. 2021-12, Published in Hammond, P.B., R. Maurer, and O.S. Mitchell (Eds.) (2023). Pension Funds and Sustainable Investment: Challenges and Opportunities. Oxford: Oxford University Press., Available at SSRN: https://ssrn.com/abstract=3890879 or http://dx.doi.org/10.2139/ssrn.3890879

Rob Bauer (Contact Author)

Maastricht University ( email )

P.O. Box 616
Maastricht, 6200 MD
Netherlands
+31 43 3883871 (Phone)

European Centre for Corporate Engagement (ECCE) ( email )

Tongersestraat 53
Maastricht, 6211LM
Netherlands

Paul Smeets

University of Amsterdam ( email )

Plantage Muidergracht 12
Amsterdam, 1018TV
Netherlands

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