Company Pension Schemes Seen as Strategic Future Tools Amid Political Challenges

Company pension schemes (bAV) are increasingly recognized by German businesses as pivotal for sustainable retirement planning and crucial instruments for attracting and retaining skilled employees. At the recent WTW bAV conference in Frankfurt, attended by around 200 representatives from medium and large companies, participants emphasized the strategic importance of bAV despite criticism of the current political framework. While the German government has introduced a new pension package, experts argue that key elements remain insufficient, citing the Riester pension reform as based on immature concepts and the early starter pension as limited in coverage. The BRSG II law has made some improvements, particularly for low-income earners and social partner models, but opting-out options remain largely tied to collective agreements, limiting their relevance for many companies.

A pulse survey at the conference revealed strong calls for reducing bureaucracy, enhancing legal certainty, and improving opting-out options to better leverage capital market investment opportunities. Businesses stressed the need for balanced bAV designs that align employee needs with employer financial and administrative requirements. Digital solutions are gaining importance in simplifying processes and increasing transparency.

The conference also focused on engaging the younger workforce, with companies like BASF and Uniper highlighting clear communication, tailored products, and financial education as vital. Experts including Roger Urwin from the Thinking Ahead Institute and ESA reserve astronaut Nicola Winter contributed insights on investment trends and decision-making under pressure. Despite political uncertainties, bAV is viewed as a robust, attractive, and future-proof system, with many measures already implementable without waiting for political reforms.

Supporting this focus on workforce wellbeing, 19 companies in the Osnabrück region were recently honored for family-friendly workplace policies, which studies show increase motivation and loyalty among employees—a complementary factor in employee retention strategies.