In Monday's edition, NZZ had an article advocating the introduction of the prudent investor rule to Swiss pensions regulation, thereby abolishing the current rules prescribing fixed limits per asset class. This proposal is in line with the recent criticism of Swiss regulations by the IMF. While it is true that the strict limits can be dispensed with by IORPs declaring their specific purpose, the article introduces a very valid argument: IORPs which operate within the boundaries of those limits will typically not fulfill their fiduciary duties because their investments are not tailored to their individual economic requirements - they are "only" in line with legal requirements. Therefore these legal limits are inherently contradictory to the purpose of the regulation.
Incidentally, the Prudent Investor is not only advocated by Messrs. Skaanes & Hauser in conjunction with the IMF, but also by the Pensions Directive, of course.
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