Your pension, our accountability

Our accountability

Let's first address the financial accountability. In 2018, the policy coverage ratio – the average over 12 months – of Pension Fund TNO started and ended at 114.0%. There was a slight increase over the course of the year, but in the last few months of the year – and particularly in December – the stock markets fell sharply. 100% would be precisely enough to meet all the Fund’s commitments. Statutory regulations mean that the fund needs to have a coverage ratio of at least 104.1%. Our ambition, however, is to fully index the accrued pensions and the benefit payments. This requires a policy coverage ratio of approximately 122%.

Options for keeping pace with inflation are limited

The policy coverage ratio of 114% means that we cannot offer the maximum growth of your pension to keep pace with price increases. Based on price inflation of 1.68% (CPI-derived), we are allowed to index your pension by 0.55% (0.42% in 2018) on the basis of statutory calculation rules. Due to the limited indexations of recent years, there is now a backlog compared to your current accrued pension. On 1 January 2019, this amounted to 9.5% if you have been receiving a pension since 2009. For active members who were already in the pension scheme before 2009, the backlog is less due to the pension accrual that is still taking place in full.

Also when it comes to climate and socially responsible investment

Openness about our investments with respect for people and the environment is very important to us. Socially responsible investment is an example of this. To put this even more securely in place, the Working Group on Ethical Investment was transformed in 2018 into a permanent management committee on 'Environmental, Social and Governance'. The following concrete results were achieved:

It was decided in 2018 to stop investing in companies that generate 5% of their turnover from tobacco production.
The site provides a quarterly overview of our investments, how our voting policy is organized, and how many companies are excluded because they do not comply with the United Nations Global Compact Principles (UN GCP).

You can read more about the results achieved in the 2018 annual report. We will continue with this in 2019. A step-by-step approach is needed to ensure the future sustainability of the pension fund. Our ambition is a long-term policy in which climate policy is also addressed. That will be given shape this year. You’ll definitely be hearing more about it!

In 2019 we will continue with a step-by-step approach

More information? Take a look at our annual report.

It provides more information about:

The Board's report on 2018
The seven strategic ambitions and the results achieved
Developments in pension management
Financial developments: on costs, risks, and capital
The evaluation

This is a selection of what you can expect in the annual report. You will of course also find the financial statements for 2018 and a look ahead to 2019. And if you come across any unfamiliar terms, you will find a glossary in appendix 2 of the annual report.