Charity plans unduly risky

defined benefit schemes put extra risk on organisations in environment of falling equities

Charity trustees offering defined benefit (DB) schemes are taking on added risk at a time when their mainly equity-based portfolios have been badly hit, according to Carr Sheppards Crosthwaite. As a result, the private client firm believes trustees need to be considering the use of commercial property in their portfolios as a hedge against equity exposure and reconsidering offering final salary schemes. While accepting that DB schemes provide the safest and usually the best form of pension provision for employees, the firm believes they represent the most risky option for the employer in...