Shen Holding, a major manufacturer of construction materials in Armenia, has signed an agreement on voluntary pension coverage for its staff with “Capital Asset Management” CJSC (“CAM” CJSC), the first and still only company in Armenia to manage voluntary pension funds.
Anna Vardanyan, Corporate Secretary of Shen Holding, has told ArmInfo that Shen Holding is the first company in the real economy to care for the future (supplementary) pension benefits of its employees. “This decision is an integral part of a socially responsible company’s policy and one of the most important tools of the employee incentive program”, she says.
Vardanyan specifies that Shen Holding offered two voluntary pension schemes to its staff, specifically, joint funding (the company doubles the employees’ pension contributions) and unilateral funding (as a pension trustee, the company makes contributions unilaterally). For the moment, Shen Holding’s employees prefer the latter. According to this scheme, the company makes pension contributions worth 1% of the employees’ wages on a monthly basis but leaves the wage rate unchanged.
Shen Holding’s employees choose the policy of investing their future pensions. Each of the employees has an opportunity to choose between the two funds of Capital Asset Management (CAMavor-1 and CAMavor- 2) or the ratio to distribute the monthly payments between the two funds. The company specifies that CAMavor-1 envisages investing the pension contributions in securities that ensure sustainable yield, specifically, in government and corporate bonds as well as corporate securities issued by the local executive bodies. Up to 20% of all the pension assets can also be invested in bank deposits and up to 25% – in unit investment funds. The policy of CAMavor-1 also envisages investing assets in derivatives for hedging purposes only.
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