Defined contribution (DC) schemes are more likely to be aiming to benchmark their contribution rates against their competitors' than against the delivery of sufficient retirement outcomes to members, according to Aon.
Its DC Pension Survey 2020 found that 44 per cent of responding schemes' described their main aim to be to provide a pension in line with their peers.
By comparison, 29 per cent described their main aim as to deliver sufficient funds for employees to retire at a 'reasonable age' and 19 per cent said it was to be a 'market-leading pension'.
More than one in 20 (6 per cent) said their aim was to just meet minimum requirements set by regulators, while 2 per cent described it as to provide similar outcomes to a previous defined benefit arrangement.
Furthermore, 65 per cent of respondents did not know the projected outcome for a typical pension scheme member and one in three schemes did not measure progress against their objectives.
Commenting on the findings, Aon principal consultant, John Foster, said: “It is key to make sure that there are robust measures in place to be able to check progress against these objectives and to identify where resources can be best focused.
“However, at present we feel that the measurement process is rather hit and miss and doesn’t actively demonstrate value.”
Aon's survey also revealed that one in three trust-based and one in five contract-based DC schemes plan to move to a master trust structure in the next five years.
Aon partner and head of DC investment proposition, Jo Sharples, added: "Many schemes are moving to a master trust structure to help with their aim of delivering better member outcomes.
"We believe that this could help them to free up time and resources to focus on retirement adequacy or for the master trust providers themselves to pick up on the adequacy challenge.
“Either way, it is imperative that those running pension schemes understand the areas where they can really add value and which areas could better be delivered through a professional third party."
Just 25 per cent of employers consider pension outcomes in the context of future workforce planning.
Additionally, only 8 per cent of default funds invest in ESG funds, despite the findings that 57 per cent of members would be more engaged with their pensions as a result of responsible investing.
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