Pension beneficiaries’ and fund managers’ perceptions of responsible investment: a focus group study
Authors: Apostolakis George , Kraanen Frido , van Dijk Gert 
Published: January 2016

Purpose
This study aims to explore the views of pension beneficiaries and fund managers regarding greater involvement and investment autonomy and the attitudes toward diverse responsible investment criteria. The conventional form of investing is usually vulnerable to high financial market volatility events and financial crises, and most importantly, it has proven insufficient in addressing important social issues. A newly introduced investment culture known as impact investing strives for social gains in the long term rather than the maximization of financial returns by aiming to tackle social problems. However, some in the field claim that implementing such investment policies compromises the fiduciary responsibility of pension funds’ trustees to manage trust funds in the best interest of beneficiaries.

Design/methodology/approach
This study uses qualitative methods to explore the perception of proposed pension policies, such as beneficiaries’ greater involvement in determining pension investment policies that can have a positive long-term impact on their lives and on the provision of investment autonomy. For this purpose, the study investigates beneficiaries’ positions regarding responsible investment criteria from a freedom-of-choice perspective. The study sample consists of members and managers of a Dutch pension administrative organization with a cooperative structure. Three semi-structured, homogeneous discussions with focus groups containing between seven and nine participants each are conducted. The data are coded both deductively and inductively, following the framework approach, which is a qualitative data analysis method.

Findings
Participants demonstrate positive attitudes toward greater involvement and freedom of choice. However, the findings also indicate that members and pension fund managers have different views regarding responsible investment criteria. Members have more favorable attitudes toward responsible investment than do managers.

Research limitations/implications
This research is limited to focus group discussions with managers and members in the Dutch healthcare sector.

Practical implications
How little the current pension system matches people’s investment preferences is a matter of concern, and the main implications of this research thus center upon designing a more democratic pension system for the future. Greater involvement by pension fund beneficiaries, whose roles are currently limited, would help legitimize responsible investing. This research implies that pension policies should be designed to align with the preferences of pension fund beneficiaries and be accompanied by diverse intervention strategies.

Social implications
Pension reforms that encourage pension beneficiaries to exert greater influence in determining pension policy will help shrink the democratic deficit in collective pensions.

Originality/value
This study contributes to the literature on pension fund governance and long-term responsible investing by examining the attitudes toward impact and sustainable investments and by making suggestions for future research. To the best of the authors' knowledge, this study is the first to investigate the attitudes of pension fund participants toward targeted impact investments.