PensionsEurope today published a position paper with its views on the review of the mandate of the European Supervisory Authorities (ESAs).
In our paper, we highlight the fact that pension funds do not fall under a harmonised European framework. National supervisors are therefore best equipped to take into account the specificities of pension funds, which are embedded in domestic labour and social law. This means that there less scope for supervisory convergence for pension funds and the mandate of EIOPA should reflect this. As pension funds are not directly supervised by the ESAs, they also feel they should not contribute directly to their budgets through industry fees.
Moreover, the governance structure of EIOPA should ensure that decision-making is underpinned by sufficient expertise in the area of pensions. We feel that individual stress test results of IORPs should not be disclosed and the Board of Supervisors should remain the decision-making body for the stress tests.
Finally, we welcome a bigger focus on better regulation and a stronger role for the Stakeholder Groups.
The Commission held a public hearing on simpler withholding tax procedures for Europe today to present the Code of conduct on withholding tax (WHT) to stakeholders and have a lively exchange of views. In today’s hearing, Mr Matti Leppälä, Secretary General/CEO of PensionsEurope, participated in the first panel discussion on the current state of play, why the WHT procedures are costly and lengthy, and to what extent implementing the code would improve the situation. Please find some of his remarks in our press release.
PensionsEurope today published a position paper on the proposal of the European Commission to introduce a EU legislative framework on a Pan-European Personal Pension Product (PEPP).
PensionsEurope believes that a European framework for voluntary personal pensions is particularly needed and useful for those who don’t have access to workplace pensions, such as self-employed and workers in new forms of employment, or where personal pensions offered at the national level are not reliable or attractive. The PEPP could be especially useful for young European citizens who have more and more often a career in multiple Member States.
However, PensionsEurope considers that some amendments are needed to the proposal if the initiative is to be successful. In particular, it will be important to ensure that the proposal will not negatively affect already existing and well-functioning pension systems.
You can read the PensionsEurope press release here.
You can read the PensionsEurope position paper on the PEPP here.
PensionsEurope has responded to the European Commission consultation on investor duties relating to integrating sustainability factors in investment decision-making. In our submission, we argue that there are many best practices and approaches of how pension funds consider sustainability factors. While pension funds increasingly will need to address societal expectations on responsible investment, we believe that a prescriptive, mandatory approach would not be able to take account of this diversity of existing approaches. You can read our response here.
EIOPA published the results of its 2017 IORP stress test on 13 December 2017 and made very strong allegations about the healthiness of IORPs based on its own theoretical model that has not been adopted by the EU or any member state. The actual prudential rules that are in place at national level do not support EIOPA’s findings. The differences in findings highlight how EIOPA’s model is not fit for purpose. Read more in the PensionsEurope press release.
According to PensionsEurope statistics 2017 our Member Associations represent:
- Pension funds: €3549 billion assets and 65 million Members and 27 million Beneficiaries;
- Book reserves: €334 billion assets and 10.2 million people;
- Group insurance: €61 billion assets and 7.7 million people;
- The 3rd pillar personal pensions: €139 billion assets and 16.3 million people.
You can find the PensionsEurope statistics 2017 here
PensionsEurope welcomes that the ECB, EIOPA, Eurostat, and OECD try to align their reporting standards for pension funds. We encourage them to align all the reporting standards together with the national competent authorities as much as possible. We support the principle to leave a lot of flexibility to the Member States in the process of data collection and distribution. A starting point should remain the so-called ‘one-stop-shop’-concept, and considering the amount of information already available, the NCAs should play a central role therein. Please find PensionsEurope answer to the EIOPA consultation here.
In our answer, PensionsEurope thanks the ECB for an open dialogue on streamlining statistical reporting requirements for pension funds, and taking many concerns by PensionsEurope into account so far. We also highlight our remaining concerns and stress that we are ready and willing to further provide our expertise to the ECB in order that the benefits of the new reporting requirements will outweigh the costs. Please find our general remarks here and specific comments here.
On 20 September 2017, PensionsEurope responded to the questionnaire on the Interim Report of the High-Level Expert Group on Sustainable Finance. In our response, we make several suggestions on how to enhance pension funds’ role in sustainable finance and long-term investment. Pension funds are natural long-term investors and can play an important role in funding green projects, provided they are not unduly constrained by regulation. We have commented on ideas in the Interim Report that aim to improve information for investors through initiatives such as bond labels, a taxonomy of sustainable assets and corporate reporting. We highlight our concerns on the practicalities and usefulness of integrating ESG risks in stress tests. We also argue any reporting requirements for pension funds should focus on measurable and objective information, while imposing a proportionate additional administrative burden. Please find our response here.
The EU’s High-Level Expert Group on Sustainable finance published its early recommendations on 13 July. PensionsEurope welcomes the initiative and will work with members to respond to the public consultation that will be launched shortly and is expected to run until mid-September.
You can read our press release here.