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MSCI AGR Issue Brief - Global Pension Underfunding Concerns

There has been much written about a brewing crisis for both private and public pensions funds due to the gap between pension obligations and the resources set aside to fund them.1 Large levels of underfunding are not just a concern for employees, but for investors as well, as the need for companies to replenish pension funds could negatively affect earnings.2

1 See for example "UK’s Pension Funding Hole Hits 900bn after Brexit", Financial Times, June 26, 2016.

2 See for example "Alcoa’s Results Highlight Risk of Pension Underfunding," Barron’s, October 12, 2016.