Spring report of the Pension Fund

In this column, the Chairman of the Pension Fund Governing Board (PFGB) will regularly present the latest main decisions, initiatives and accomplishments of the Governing Board to the members and beneficiaries of the Fund.


Since my last report in April, I am pleased to report the following progress. 

On the recommendation of the Finance Committee, the CERN Council approved the updated Financial Regulations of the Fund at its June session, with immediate effect. The approval of the Financial Regulations completes a key part of the regulatory framework of the Fund’s operations.

Also in June, the Council approved the Financial Statements of the CERN Pension Fund for 2011.  The Financial Statements had been certified by the Italian Court of Audit (CERN’s External Auditor), which gave its report to Council. 2011 was the first year during which the audit-related provisions of the updated Fund Rules were fully implemented.

On the investments side, the Fund continues the implementation of its capital preservation approach, which is particularly appropriate in the current conditions, where capital markets remain extremely volatile, and risk-free assets, such as Swiss government bonds, offer historically low yields. Implementation of the capital preservation approach implies moving to a portfolio with lower risk and greater efficiency that is compatible with the return objectives fixed by the Council. This transition is presently 30% complete.  The target is to have 80% of the portfolio aligned with the capital preservation mandate by the end of 2013. The initial results are very encouraging: as of 31 May 2012, the Fund had returned +2.0% year-to-date, whereas for comparison, the Eurostoxx50 index return for the same period was -8.5%.  A presentation on the status of the Fund’s assets and implementation of the capital preservation strategy was given by the CEO of the Fund both at the Finance Committee and the Council in June.

In 2011, the Fund initiated a project to enhance internal controls and develop an Internal Control System (ICS), which is integrated in all activities of the Fund. The first implementation of the ICS was audited this past spring by an auditor specialized in pension fund matters. The audit verified the completion of the documentation of the main risks and associated controls, the execution of controls as a part of daily activities, and a clear distribution of responsibilities.

I conclude by reporting the following recent appointments to the PFGB and its Investment Committee. The CERN Staff Association appointed Dr Alessandro Raimondo, a CERN staff member from the EN Department, to the PFGB with effect from 1 May 2012. Mr. Raimondo was subsequently appointed by the PFGB as a member of the Investment Committee. Mr Sylvain Weisz, appointed to the PFGB by the CERN Staff Association since 2010, was unanimously appointed Vice-Chairman of the PFGB by the Council at its June session. I wish them both success in their new functions.

Dan-Olof Riska,
Chairman, Pension Fund Governing Board