21 August 2009
Published in: Risk governance, Operational risk
Aon promotes ERM for pension fund management
Aon has introduced an ERM pensions platform that it says enables trustees to produce regular and accurate reports giving both the company and pension scheme members the confidence that risks threatening the payment of their benefits in full or adversely affecting the sponsoring company are being managed.
According to Aon, pension schemes historically have focused their risk management largely on financial risks such as data loss and insolvency, whereas they would benefit from a broader approach to risk. In a bid to expand the scope of their risk management, Aon is working with the industry to encourage it "to include non-financial, operational and strategic risks."
Marcus Hurd, head of corporate solutions at Aon Consulting, said: "ERM has a key role to play in the future of pension scheme management. A holistic approach to risk management is critical to the performance and operation of the pension scheme. The ERM framework structures a diverse collection of risks in a coherent and manageable way."
Among the risks Aon believes ERM expertise can help pension scheme managers and actuaries to identify, assess and manage are:
- historical data difficulties
- legal interpretation
- technology failures
- the introduction of new legislation, regulation or accounting standards.