The funded status of defined benefit (DB) pension schemes in Canada, the Netherlands and the US has declined since December 2011, while the UK has experienced improvements, according to research by Mercer.
The greatest decline has occurred in the Netherlands, where the funded status has fallen from 96% to 80%, followed by Canada with a decline from 87% to 83%, and the US, where the funded status of DB schemes declined from 75% to 73%.
According to Mercer, the causes are primarily declining discount rates, which are used to measure pension liabilities, and lacklustre asset performance.
In the UK, the research found that the funded status of DB schemes remained broadly level over the period until September 2012, when there was an improvement of 92%.
Frank Oldham, senior partner and global head of the DB risk group at Mercer, said: “There’s a multitude of risks facing multinationals with only a single DB scheme, but this data shows the scale of risks and problems facing companies with schemes in multiple geographies.
“It has not been uncommon for funding levels to move in different directions in some markets over the same month. It is crucial therefore that multinationals can monitor their cross-country exposure and react quickly to capitilise on local opportunities.”