A fair-value enterprise

Cutting Edge: Liability management

IntroductionPension companies have traditionally based their business model on a principle of caution where financial and insurance elements are set according to a so-called technical basis, representing a worst-case scenario of the future (Norberg, 2004). The conservative assumptions are intended to protect the solvency of the company against all 'plausible' events. The timespan of pensions is decades and events that seemed implausible, say, in the 1980s have become painful reality since th