The Dynamics of Inclusion and Exclusion
Edited by Peter Mooslechner, Helene Schuberth and Beat Weber
Chapter 9: The Governance of Occupational Pension Funds and its Politico-Economic Implications: The Case of Austria
9. The Governance of Occupational Pension Funds and its PoliticoEconomic Implications: The Case of Austria Stefan W. Schmitz* This paper analyzes the efficacy of the governance structure of occupational pension funds (Pensionskassen – PKs) in Austria. Based on the results of the analysis, it further investigates the politico-economic implications for the political and legislative process regarding recent changes to the relevant act (Pensionskassengesetz – PKG). The first section explains the exclusion of the beneficiaries’ interests from the institutional interest of the PKs’ association, i.e. the distribution of power, by the underlying governance structure of PKs. It focuses on the structural conflict of interest faced by PKs, namely between their beneficiaries and their shareholders (almost exclusively large Austrian banks and insurance companies). The shareholders’ instruments to control the PKs are largely determined by the Joint Stock Company Act.1 The PKG includes provisions which can be interpreted as means to counterbalance the shareholders’ dominance and to ensure that PKs conduct their business in the interests of beneficiaries, but which were also motivated by the objective of selling PKs to beneficiaries and works councils. This section addresses the following question: How effective is the governance structure of PKs at the micro and meso level with respect to the objective of counterbalancing the structural dominance of shareholders? The notion of governance developed in the New * The author thanks Daniel Gradenegger for his excellent research assistance and the members of the working group on financial governance for their very helpful comments. The usual disclaimer applies. The views...
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