Pension schemes employ a basic objective so that their members in employment could save for their retirement and get returns while maintaining membership and ensuring a healthy funding level to guarantee sustainability. Pension schemes must engage stakeholders and manage them in the best acceptable manner for maximum operationality. All pension schemes must keep on innovating to accommodate dynamic market patterns and ensure that the promise to their members during retirement is kept alive. Several evolving strategies by pension schemes are coming out over time be it regulatory, investments, management, benefits, and other projects in the name of ensuring a healthy sustainability.
Pension funds are playing an increasing role in creating solutions to some of society’s most significant challenges, They are capable of several innovations by relooking or repositioning their strategies and organizations around emerging technologies and other services especially realigning the risk-based benefits to cover a higher percentage of risks revolving around member fears.
Stakeholder management is the process of maintaining good relationship with the people or entities who have the strongest impact on the pension industry. Healthy communications with them play a vital role in keeping the relationship going and without proper management, the dream of pension industries to pay the members and improve their livelihood would turn out to be a mirage causing more uncertainties and crashing the pension scheme legacy. Communications to the stakeholders must be well guarded to ensure that they create a long-term relationship for the success and growth of pension schemes and more so, sustain the integrity of schemes management and regulatory mechanisms employed, high investment returns, and general management of the schemes.
On the other hand, as the saying goes “Innovate or Sink”. Pension schemes from their nature of deferments need a more complex approach to ensure that their investments are sustainable when it comes to retirement benefits and should keep on appreciating their returns. Occasionally, benchmarking initiatives need to be employed with public-private initiatives or vice versa being employed so that they remain afloat in times of innovation. The stakeholders must see to it that they support the scheme to realize their set goals and vision and have a realistic strategic plan.
Innovation in the pension schemes is where the scheme has to go an extra mile to come up with ways of keeping the stakeholders afloat and this applies to both internal and external stakeholders. Stakeholders are very important for crucial support, investment direction, and provision of resources which may come in through advisory, sponsorships of schemes, and a lot of time is needed to enhance communication continuity.
Stakeholder management becomes an integral part of your project rather than treating it as just any other task. In Pensions, the Primary Stakeholders are employees, members, trade unions, suppliers and investors. Pension schemes which have satisfied regulatory standards are able to invest in a number of projects which are meant to benefit the schemes in return. They also need to benefit other stakeholders in making some of the complex projects like housing to become affordable out of pooled resources as these projects are in line with the stakeholders' expectations.
The Governments and politicians as stakeholders in terms of regulatory controls are very important for pensions to succeed. As is the case in Kenya, they support most of the innovative investments such as affordable housing and investments in government securities and bonds. For all these investments to be accepted, they must have their backings as a catalyst for successful regulation.
A proper governance of the scheme increases the involvement of the stakeholder and the scheme itself. Several programs as part of innovations make the stakeholders buy assets whose growth is for the benefit of all stakeholders.
In conclusion, Pension schemes’ sustainability is anchored in the best management strategies, innovations in their operations, especially investments, and healthy stakeholder relationships.
Scottish Qualifications Authority, UK
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