Russell Updates Corporate Pension Finance Handbook

The firm added information about the Moving Ahead for Progress in the 21st Century Act (MAP-21) and pension risk transfer. Written for chief investment officers, chief financial officers and treasurers, the Handbook was compiled by Russell’s Bob Collie, chief research strategist, Jim Gannon, director, asset allocation and risk management, and David Phillips, senior investment strategist, and is divided into three sections—the pension plan and the corporation; pension plan basics; and special considerations for frozen and closed plans.

“Given how quickly these changes are occurring and the complexity of the market environment, we believe a reader-friendly handbook like this can play an important role,” said Collie. “It’s been very well-received because it provides decision-makers with an overview of the big issues and how they impact the sponsoring corporation.”

The Handbook includes information about how to: 

• Navigate pension liabilities in the face of Pension Protection Act (PPA) and MAP-21 requirements;
• Manage pension expense on the income statement;
• Understand the impact of defined benefit (DB) plan closure or freezing;
• See how interest rate volatility impacts the plan; and
• Look ahead to future pension accounting potholes.

“The trends that we see in pension plan management—such as the interest in liability-driven investing, fiduciary solutions (i.e., investment outsourcing) and multi-asset solutions—are not happening in a vacuum,” said Bruce Clarke, managing director, Client Service. “They are happening because managing a pension plan is a different challenge today than it was five years ago. Corporations need to understand this complex and shifting landscape and how it can affect them.”

Copies of the Handbook can be requested here and printable worksheets for analyzing plans can be downloaded by plan sponsors.