Autumn report of the Pension Fund

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

The main developments concerning the Fund since my last report in April are the following.

In June I made my regular report to the CERN Finance Committee and Council, which summarized the recent activities of the Pension Fund. At this session the Council, on the recommendation of the Finance Committee, approved the Financial Statements of the CERN Pension Fund for the financial year 2012 set out in document CERN/FC/5742-CERN/3066 and certified by the Italian Court of Audit.  In 2012, the Fund achieved annual gains and income of 251 MCHF, which resulted in a net increase in assets by 165 MCHF at the end of the year. As reported in my previous column, the return on assets of 6.89% exceeded the Fund’s return target by 3.89 percentage points as inflation was effectively nil in Geneva during the calendar year 2012. In combination with the special contribution made in 2012 by CERN and ESO, this result led to an increase of the Fund’s funding ratio by 2.6 percentage points from 63.5% to 66.1% at the end of 2012. The Fund also maintained a prudent risk level throughout the year, in compliance with the risk tolerance level set for 2012.

It was reported to the Council that at its meeting on 16 May 2013 the Pension Fund Governing Board (PFGB) had decided to delete those sections of the Rules and Regulations of the Fund, which had now become obsolete after the approval of the updated version of the Rules and Regulations.

During its June session, the Council appointed Dr Thomas Roth, German delegate to the  CERN Finance Committee and advisor to the German delegation to Council, to succeed me as member and Chairman of the Governing Board for a period of three years beginning on 1 November 2013. The Council also appointed Professor Branislav Sitár, a delegate to Council from Slovakia, as member of the Governing Board for a period of three years, beginning on 1 January 2014. Professor Sitár will succeed Mr Bruno Moor, a delegate to Council from Switzerland, who completes his 3-year mandate as member of the PFGB at the end of December 2013.

In April, Mr Claude Genier joined the Governing Board, having been appointed by the GAC-EPA to replace Dr François Wittgenstein.  In the course of eight years of valuable and loyal service to the Fund, Dr Wittgenstein brought both deep insight and a broad cultural outlook to the Board. He will be greatly missed.

I am happy to announce that on 15 May, the Fund received the 2013 “Gold Award” for Medium Real-Estate Investor, from Investments & Pensions Europe (IPE). The IPE awards, which have a worldwide scope, are judged by a panel of 22 European consultants and pension fund executives.  The CERN Pension Fund was recognized for the “fresh thinking” behind the update of its real-estate strategy, which has brought it “focus” on “high-quality assets and diversification.” The jury also noted the Fund’s “streamlined and cost-efficient” management, and noted that CERN is “running a tight ship.”

Dan-Olof Riska
Chairman, Pension Fund Governing Board