The pension agreement and the intended transition to a new pension scheme is expected to be the most important dossier for the Board in 2021. Together with DPS, we were closely involved in the policy processes in The Hague in 2020. PDN was one of the pension funds that made the calculations that form the basis for the proposed legislation. We were also represented in the pension federation working groups and other fora.
For us, the primary goal in 2021 is to reach a good alignment with the PDN stakeholders in this process, particularly with the social partners, including allied businesses, the fund bodies, the administration organization, and representatives of deferred members and pensioners. We can then use a collective knowledge base and project planning in our decision-making, which will contribute to a supported decision-making.
Communication with members is an important priority in 2021. Considering the major changes in the pipeline for members, the fund’s focus is to keep members up-to-date in time. Members have encountered challenges in their current pension provision for many years and they regularly hear about the proposed review of the pension system. In 2021, the fund will provide an explanation of the changes, how the fund will prepare itself for these, and the potential changes this will entail for members.
In conjunction with the pension agreement, the Board will conduct an extensive check in 2021 on the robustness of the administrating organization, DPS. This focuses on determining potential loopholes with respect to being able to act successfully in the coming transition process and identifying and then realizing the required solutions. As part of the robustness testing, a decision was taken in early 2021 to make substantial investments in the IT investment infrastructure. This will be implemented in 2021 and subsequent years.
The Own Risk Assessment (ORA) will also take place in 2021, the launch of which took place in 2020 via the Risk Vision and the RCA. The ORA will answer key questions regarding the scale and future viability of the pension fund. This is related to the pension agreement process, the robustness testing and the investments made by the fund. This will ensure that the ORA has a strict focus and clear added value in the pension agreement process.
Another priority for the Board in 2021 is the sustainability policy for investments. Additional steps will be taken, including further implementing our compliance with the requirements from the ‘Sustainable Finance Disclosure Regulation’ (SFDR legislation). The Board believes in the added value that pension funds can create in this area, by investing the considerable sums entrusted to them in a socially responsible and sustainable way. This also connects to the demands made on the fund by members, DSM as most important employer, the Dutch government, and the EU. The Board will also critically examine how investment risk and the expected investment returns align with this policy. An action plan has been formulated including milestones and space for knowledge sharing and coordination.